Compliance with the new ASC 842 and IFRS 16 lease accounting standards involves more than the Accounting department. While centralizing lease data in the right lease accounting software is an integral part of compliance, it also requires a holistic view of the scope of work necessary for full compliance requires a core team plus stakeholders from across the organization. Here’s an overview of lease accounting project roles for a successful ASC 842 and IFRS 16 compliance initiative:
The core project team
Due to the technical nature of the lease reporting requirements, the Accounting department is a great choice to lead the overall initiative. The scope of this initiative spans beyond accounting. A group of four or five key departments needs to be heavily involved, and a larger group of departments need to be involved in the broader team.
Although there may be variations, here is a recommendation for project roles on the core project team:
- Accounting: Recommended project lead, valuable background on subject matter and requirements for financial reporting
- IT: Technical know-how important for vetting and implementing new lease accounting software solution
- Program and Project Management: Offers the skill set necessary for keeping the project on track and on budget
Larger cross-functional team
While the new lease accounting standards will involve a diverse group of stakeholders across the organization, traditionally departments have independently managed leases with little guidance or influence from other departments. As companies adopt a more centralized approach to lease accounting for both real estate, equipment and other assets, consider involving these additional stakeholders in the broader team:
- Financial Planning
- Maintenance logistics
- Property management and
- Lease administration
- Real estate
For more in-depth recommendations on lease accounting project team roles, see our 12 Step Guide to Lease Accounting Compliance which offers helpful tips and best practices for compliance initiatives and lease accounting software implementation.