CoStar helped this global organization's accounting teams consolidate lease liability data, upgrade management systems and securely implement an ASC 842 and IFRS 16 compliance solution.

The Client

Holding $2.5 trillion in assets, this multinational Fortune 25 company is the largest bank in the U.S. with more than 11,000 owned and leased locations and $100 billion in annual revenue.

The Challenge

With more than $12 billion in real estate and equipment lease obligations, compliance with the new FASB and IASB lease accounting standards represented a significant challenge and expense for the company. The need for proven lease accounting functionality was critical to the accounting team. But because the organization is a leader in the finance and banking industry, the need for the most secure system platform available was paramount.

The Solution

CoStar was chosen to be the bank’s software provider for lease accounting compliance for many reasons. Chief among them was passing the rigorous and thorough review that bank representatives conducted on CoStar’s system, data management and company processes. The comprehensive security assessment including in-person site visits to CoStar’s hosting facility and offices. Recognizing the essential need for low-risk solutions is why CoStar’s system platform undergoes an annual SSAE 18 SOC 1 and SOC 2 audit, ensuring controls and procedures for financial reporting meet Sarbanes-Oxley requirements. CoStar was also able to provide a Standardized Information Gathering document that demonstrated its highly sophisticated technology and mature processes related to the protection of information.

The Results

The bank’s equipment lease data was migrated to CoStar’s lease management system, which allowed for enhanced workflow and status updates of lease changes. CoStar integrated with the bank’s SAP ERP system for posting new assets and liability journal entries as well as amortization entries. CoStar’s data connector also integrated a proprietary lease management system. This helped balance the demands of accounting close with the lease accounting project and UAT schedule. CoStar team members were also able to review what the accounting changes and balance sheet impact would be for each business unit, enabling better business decisions for leasing operations.