FASB’s Pending Changes to Impact Corporate Real Estate
The proposed changes to Generally Accepted Accounting Principles (“GAAP”), when accounting for real estate (and equipment) lease commitments, will significantly change recognition for leases that are now classified as operating leases and will impact corporate real estate beyond just changes to financial accounting procedures.
The Corporate Real Estate community appears less than excited about the proposed changes from the Federal Accounting Standards Board (FASB) that are expected to become effective in Fiscal Year 2012/2013. Read Bob Cook’s post “Lease Accounting: Don’t Shoot the Messenger” from his blog Corporate Real Estate Strategy.
How will FASB’s pending changes impact corporations?
My Colliers International colleague, Brett Hardy in Los Angeles has authored an excellent overview of the potential impact of these changes. “The objective of the lease accounting being considered by FASB and the International Accounting Standards Board (“IASB”), is to create a common lease accounting standard to ensure that assets and liabilities arising from lease contracts are uniformly recognized in the financial statements”, says Hardy.
To download Brett Hardy’s article click here