Many public companies have spent the better part of the last two years reworking lease accounting practices to comply with a new accounting standard that went into effect for calendar-year reporting entities on January 1, 2019. Private companies have been given an extra year to manage the transition and are expected to be compliant beginning January 1, 2021. This is a complex and resource-intensive process requiring a deep dive into lease contract terms and conditions.

This article summarizes finance organizations’ lease accounting journey and provides steps that can be used for the lease accounting transition.