Taking Lease Accounting Compliance to the Next Level
It was just over a year ago that a lease accounting change over a decade in the making was finalized. Understanding the impact became critical for all companies with significant lease portfolios.
As I stated in a blog post last year: “Retailers are disproportionally impacted by these accounting changes since leasing real estate is such a critical principle of their business. Of the top 20 US public companies with the largest operating lease portfolios, 10 are traditional retailers and an additional seven have some retail store operations. Collaboration between operations, real estate, finance and technology will be essential to manage through the process.”
Fast forward a year - we’ve had the opportunity to gather feedback from dozens of retail and restaurant companies, and consistently we hear Tango’s solution is unique for three reasons:
- First, it was built by Tango. At the risk of sounding immodest, Tango’s team has over 20 years of experience in lease administration as a company, and we are responsible for many of the industry innovations over the past two decades. You name a solution, and someone at Tango had a hand in its development. Our professional services team has more collective lease accounting experience than any other software vendor.
- Second, because it’s a newer entrant into the market, we didn’t have to change existing programming – a risky and complicated endeavor. We built our FASB and IASB lease accounting functionality from scratch based on the new requirements. While we also support the current FASB requirements, we carefully considered where our clients needed to end up and how they were going to get there.
- Lastly, we wanted to provide our customers with the assurance that all accounting calculations would be in compliance with the new standards. A few weeks ago, we announced that Tango is the first vendor in the lease administration space to have all the lease accounting calculations in our solution verified by a third-party accounting firm.
Our President & CEO, Pranav Tyagi, says it best:
“Tango leveraged a variety of lease accounting experts during the design and development of our solution to ensure our compliance with the ASC 840, ASC 842 and IFRS 16 standards. Because of the extensive testing that we completed, including the project that we engaged BKD to assist us with, our customers and their auditors can be assured that all the accounting entries generated through the solution can be relied upon to adhere to all required standards.”
You can read the entire release on our site.
The independent review conducted by BKD assessed how Tango’s solution treats common scenarios that impact compliance, including data capture, the operating/finance classification test, detailed accounting schedules and journal entries for both FASB and IFRS considerations.
If you are interested in learning more about how Tango’s lease accounting software provides a new approach to addressing your lease administration and lease accounting requirements, watch this webinar.