To err is human. To forgive is against company policy. Our last blog addressed how to Account for Lease Amendments that Expand the Leased Premises. In today’s article, we will explain the 6 common lease accounting errors we have found after reviewing thousands of leases.
One thing that makes LeaseQuery different from other lease management software providers is that we are not just real estate professionals; we are also accountants. Why is that important? Well, when you start using our software, we perform two tests on your leases to ensure the following:
1st Test: We make sure that you are making the correct payments based on the lease documents and,
2nd Test: We make sure that your existing leases are complying with GAAP.
While most of the existing lease software out there can perform the first test, the second assessment is more important because even though the correct payments are being made, the entries being recorded may be incorrect. Only accountants can make that determination. In today’s column, we will show you the top 6 accounting errors we have found after our evaluation of numerous leases.
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Contributed by LeaseQuery: LeaseQuery is lease management software that helps companies manage their leases. Rather than relying on excel spreadsheets, our clients use LeaseQuery to get alerts for critical dates (renewals, etc), calculate the straight-line amortization of rent and TI allowances per GAAP, provide the required monthly journal entries (for both capital and operating leases) and provide the commitment disclosure reports required in the notes and the MD&A. Contact here.