1. Scope SBITA defined Exemptions 2. Recognition and measurement of a SBITA Subscription liability Subscription asset Outlays other than subscription payments Disclosure requirements 3. SBITA accounting example Terms Additional costs evaluation Calculation of...
GASB Accounting Articles
GASB 87 Explained with a Full Example of the New Governmental Lease Accounting Standards
1. What is GASB 87? 2. GASB 87 vs. prior GASB guidance: Key differences GASB 87 lease classification What is considered a lease under GASB 87? 3. Key differences: GASB vs. FASB 4. Lessee vs. lessor accounting under GASB 87 5. Example: Accounting for a lease under GASB...
Lessor vs. Lessee: Differences, Accounting, & More Explained
1. Lessee meaning 2. Lessor meaning Lessor vs. lienholder 3. Who are the lessor and the lessee in rental agreements? Commercial real estate Lessor and lessee in subleases Sale-leaseback transactions 4. What is lessor’s risk insurance? 5. Differences in lessor vs....
Bonds Payable: Understanding the Basics of Accounting for Bonds
1. What are bonds payable? Interest in bonds Discount vs. premium Issuance costs 2. Bonds payable accounting Amortization of the discount or premium 3. Summary 4. Related articlesWhen an organization requires additional funds, a common action is to borrow money from a...
Software Capitalization Rules under US GAAP and GASB
1. Software Capitalization Rules under FASB and GASB 2. Types of software Purchased software Internally-developed software Software as a Service (SaaS) 3. SummarySoftware Capitalization Rules under FASB and GASB The capitalization of software development costs was a...
What Is an Embedded Lease? How to Determine If You Have a Lease within a Contract
1. What is an embedded lease? A contract contains a lease when the following two criteria are met: 2. How to identify embedded leases Requirement 1: A specified asset is identified Requirement 2: Control of the identified asset is transferred to the lessee 3. How the...
Right-of-Use Asset (ROU Asset) and Lease Liability for ASC 842, IFRS 16, and GASB 87 Explained with an Example
1. What is a right-of-use asset? 2. What is a lease liability? 3. Right-of-use asset under ASC 842 How to calculate the right-of-use asset under ASC 842 Right-of-use asset accounting example 4. Right-of-use asset under IFRS 16 How to calculate the right-of-use asset...
How to Calculate the Present Value (PV) of Future Lease Payments in Excel
1. Present value of lease payments explained PV (Present Value) vs. NPV (Net Present Value) Minimum lease payments and future lease payments 2. How to calculate the present value of a payment stream using Excel in 5 steps Step 1: Create your table with headers Step 2:...
GASB 96 Disclosure Requirements for Governments Explained with an Example
1. Qualitative disclosures Requirements 2. Quantitative disclosures Subscription asset disclosure Outflow of resources Subscription liability disclosure and maturity analysis Future SBITA commitments Impairment loss Exemptions 3. Presentation on financial statements...
Tool | GASB 96 SBITA Identifier – Multi-Contract
March 2023 LeaseQuery GASB Summit: Key Insights
March 2023 LeaseQuery GASB Summit: Key Insights On March 23, LeaseQuery hosted another virtual GASB Summit, during which accounting experts explored the new GASB lease accounting standards, GASB 87 and GASB 96. Over 840 attendees of the free CPE event heard speakers...
What Is a SBITA? How to Know if Your Organization Has Them
GASB Statement No. 96 What is GASB 96? Because of the increased popularity of subscription-based information technology arrangements (SBITAs) the GASB issued Statement No. 96 (GASB 96). This statement provides guidance on the accounting and financial reporting for...
Don’t Ghost The New Accounting Standards
Are you afraid of the looming accounting standards? ASC 842, GASB 87, and GASB 96 may be frightening, but ghosting them isn’t the right answer. At some point, you have to approach compliance head on. While you should beware of the repercussions of noncompliance, there...
Debt Accounting under ASC 470 and GASB 34: Overview, Loans/Notes Payable, and Bonds Payable
1. Introduction to debt accounting 2. Financial statement recognition Initial measurement and recognition Short-term vs. long-term classification Subsequent measurement and amortization 3. Types of debt Secured vs unsecured debt Notes payable and loans payable Bonds...
Qualitative Disclosures for the New Lease Accounting Standards: What You Need to Know
Footnote disclosures are a critical component of an entity’s financial reports helping users of the financial statements better understand the entity’s operations, financial results, and significant accounting policies. Most required disclosures have a numbers section...
Lease Payments: Establishing the Lease Liability/Asset & Receivable under GASB 87
1. Measurement Lessee's lease liability Lessor's lease receivable 2. Variable payments 3. Lease and nonlease components 4. Discount rate determination 5. Summary 6. Related articlesIn order to establish and maintain compliance with GASB 87, the new governmental lease...
Determining the Correct Dates & Lease Term from a Lease Agreement under GASB 87
1. Determining which dates to capture from a lease agreement Where are the important dates in a lease contract? 2. What is the lease term? Short-term lease Additional lease term considerations Termination options Financial impact of the lease term Changing the lease...
May 2022 GASB Update: Statement No. 99 Explained (GASB 87 & GASB 96)
On May 9, 2022 the GASB issued Statement No. 99 Omnibus 2022 (GASB 99) providing clarification guidance on several of its recent statements, including GASB Statement No. 87 Leases (GASB 87) and GASB Statement No. 96 Subscription-Based Information Technology...
May 2022 GASB Lease Summit: Lease Accounting Advice from Industry Experts
On May 5, LeaseQuery hosted another virtual LEASE summit, The GASB Series, during which accounting experts discussed the new GASB lease accounting standards, GASB 87 and GASB 96. At the free CPE event, speakers from LeaseQuery, MGO, The Pun Group, Cherry Bekaert, and...
GASB 87 & GASB 96 Efficiencies: Similarities, Differences, Adoption Tips, & More
The effective date for GASB 87 has passed, but GASB 96 is just around the corner. Many companies working towards compliance with GASB 87 can save time and resources by adopting GASB 96 simultaneously. This article provides a comparison and contrast of both standards,...
How to Conduct an Inventory of Your Leases under GASB 87
1. Scoping your leases 2. Definition of a lease 3. Exemptions Short-term leases Materiality Leases that transfer ownership Other GASB 87 exemptions 4. Finding your leases Look at your requisition process Engage the right departments Consolidate your leases in one...
Government Fund Accounting: GASB 87 Leases Within GASB 34 Consolidation to ACFR
1. Fund accounting in brief 2. GASB 87 lease accounting during the year Governmental fund and modified accrual leases Proprietary fund and full accrual leases 3. GASB 87 lease accounting at year-end and GASB 34 consolidation Governmental fund and modified accrual...
Lease Accounting Explained: New Standards, Lessee vs. Lessor, Changes, Calculations, & More
1. What is lease accounting? 2. Lessee vs. lessor Lessee definition Lessor definition 3. Lease accounting under the old standards 4. New lease accounting standards, changes, and full examples ASC 842 IFRS 16 GASB 87 5. Why were these changes implemented? 6. Lease...
GASB Explained: Government Accounting Standards, New GASB Standards, and a Full List of Statements
1. GASB explained 2. What types of organizations report under GASB? 3. Government accounting standards 4. New GASB standards GASB 87: Lease accounting GASB 94: Accounting for public-private and public-public partnership arrangements GASB 96: Accounting for...
How To Convince Your Board You Need a GASB Software Solution
1. Explore the pitfalls of Excel 2. Justify the investment Increased efficiency Comprehensive reporting Audit preparedness 3. Prevent employees from experiencing burnout 4. Summary 5. Related articlesWhether you’re adopting GASB 87 or GASB 96, transitioning to the new...
The Ultimate GASB Gift Guide
With the first GASB 87 effective date behind us and GASB 96 ahead of us, we’re walking in a GASB wonderland. Just like holiday shopping, it can be stressful to hunt down the perfect GASB resources for your organization. The accounting experts at LeaseQuery have...
Government Fund Accounting: Types of Funds and Leases under GASB 87 w/ Journal Entries
1. What is government fund accounting? 2. Different types of funds 3. Fund accounting & GASB 87 4. Summary 5. Related articlesWhat is government fund accounting? Fund accounting is a system of accounting used primarily by nonprofit and governmental entities. It...
Benefits of Lease Accounting Software for Dual-Filers
The new lease accounting standards are nuanced regardless of which one you apply. Having to account for your leases under two separate standards only increases the complexities. Dual-filers face challenges single filers do not have to consider. With the right lease...
Capital Lease Impairments under GASB 87: Example, Journal Entries
1. Lease impairment indicators under GASB 42 2. Recording an impairment loss under GASB 87 Example: Recording a lease impairment under GASB 87 3. Summary 4. Related articlesUnder the legacy GASB lease accounting model only capital leases were presented on the...
GASB 87 for Higher Education: What You Need to Know for Compliance
With the first semester of the 2021-2022 school year barreling to a close and annual reporting in the rearview mirror, it’s time to look ahead to the next big accounting project – GASB 87 compliance. The new guidance replaces lease accounting rules covered by GASB 13...
LEASE Summit: Accounting Experts Share Key Tips for the Adoption Process
On September 23, LeaseQuery hosted another successful virtual summit to share valuable insights for private companies and government organizations preparing to adopt the new lease accounting standards. The LEASE Summit highlighted the steps essential for transitioning...
GASB 51 vs. GASB 96: Similarities and Differences in Accounting Treatment
1. What is GASB 51? History of GASB 51 2. What is GASB 96? Why is GASB 96 necessary? 3. Similarities between GASB 51 and GASB 96 4. Differences between GASB 51 and GASB 96 5. Summary 6. Related articlesWhat is GASB 51? GASB Statement No. 51 Accounting and Financial...
The Benefits of Early Adoption of ASC 842 and GASB 87
The new lease accounting standards are coming whether you’re ready for them or not. Preparing to adopt GASB 87 and ASC 842 is a formidable endeavor. While many public companies have already undergone the process, private companies are still in the midst of the...
GASB 87 Accrued Interest Example: Calculating the Liability Amortization
1. What is accrued interest? 2. Example: Accrued interest for a lease under GASB 87 Amortization schedule for the lessee Governmental fund accounting Conversion entries Proprietary fund accounting 3. Summary 4. Related articlesThe new lease accounting standard for...
Interest Expense Calculation Explained with a Finance Lease Example and Journal Entries
1. What is interest? 2. What is accrued interest? 3. Interest expense calculation & journal entries 4. Interest expense for a finance lease Which reporting frameworks does this apply to? How is finance lease interest expense calculated? Interest expense formula How is...
GASB 87 Sale-Leaseback and Lease-Leaseback Accounting Transactions
1. Sale-leasebacks GASB 87 requirements Quantitative example Disclosure requirements 2. Lease-leasebacks GASB 87 requirements Quantitative example Disclosure requirements 3. Summary 4. Related articlesOrganizations often enter into either sale-leaseback or...
GASB 87 Disclosure Requirements for Lessees Explained with Examples
1. Qualitative disclosures 2. Quantitative disclosures Lease asset disclosure Lessee’s outflow of resources Lease liability disclosure and maturity analysis Future lease commitments Short-term leases: exempt Additional disclosures (if applicable) 3. Summary 4. Related...
Tool | GASB 96 (SBITA) Contract Tracker
GASB 87 Lessor Accounting Example with Journal Entries
1. Lessee vs lessor accounting 2. Lessor accounting under GASB 87 An example of lessor accounting for a lease under GASB 87 3. GASB 87 RFP Template 4. Summary 5. Related articlesLessee vs lessor accounting Government entity lessees reporting under GASB are required to...
Accounting for Service Contracts: Software Licenses & Leases
1. Accounting for leases embedded in service contracts 2. Are software licenses considered service contracts under ASC 842, IFRS 16, or GASB 87? 3. Accounting for software as a service contracts – what’s changed 4. Subscription-based information technology...
GASB 87 Training: 10 Resources and Tips to Ease Your Transition
In 2017, the Governmental Accounting Standards Board released GASB 87, the new lease accounting standard for government entities. Government agencies must begin applying the new guidance for all reporting periods starting after June 15, 2021. Initially, the compliance...
How to Calculate Interest Rate Implicit in the Lease for GASB 87
1. What is the implicit rate under GASB 87? Implicit rate: Understanding GASB 87 vs ASC 842 Example of calculating the rate implicit in the lease Validating the rate implicit in the lease 2. Summary 3. Related articlesUnder GASB Statement No. 87, Leases, the majority...
Tool | GASB 87 Lease Identifier
Off-Balance-Sheet Financing (OBSF) and Liabilities Impacted by New Operating Lease Accounting Rules
1. Off-balance-sheet financing 2. Examples of off-balance-sheet liabilities 3. OBS accounting activities targeted by the Boards 4. Off-balance-sheet leases: How were they recorded? 5. Recording capital leases on the balance sheet under ASC 840 6. Benefits of...
Lease Termination Accounting under FASB, IFRS, and GASB: Options to Terminate, Costs, and More
To terminate a lease is to cancel the agreement before the end of the specified lease term. Many lease agreements may include an option for either lessees or lessors to terminate the agreement prior to the end of the original lease term. Lease termination options can...
GASB 62 to GASB 87 – Eight Tips to Ease the Transition
This article was written in collaboration with LeaseQuery’s partner in easing the burden of lease accounting, Postlethwaite & Netterville (P&N). While the lease accounting delay for private companies and nonprofits may have been welcomed with open arms, it...
Tool | GASB RFP for Lease Accounting Software
Incremental Borrowing Rate for IFRS 16, ASC 842, and GASB 87: Discount Rates and When to Use Them
1. Discount rate What to do when there's no rate implicit in the lease 2. Incremental borrowing rate What you need to calculate incremental borrowing rate (IBR) What not to do 3. Changes from legacy GAAP to the new standards 4. Choosing the right solution 5. Related...
GASB 87 vs ASC 842: Five Differences from a Lessee’s Perspective
There has been a lot of material in the marketplace about the new lease standards. Up until this point, the majority of this has been focused on the new FASB guidance, ASC 842. For individuals at organizations that have been following some of the ASC 842 requirements,...
GASB 87: Two Examples of How to Transition for Lessees
The new lease accounting standard for governmental organizations, GASB Statement No. 87, goes into effect for all reporting periods that begin subsequent to December 15, 2021. In 2019, GASB released an implementation guide to provide additional clarification on GASB...
The GASB 87 Implementation Guide Is Here
After much anticipation, the Government Accounting Standards Board (GASB) has released the Final Implementation Guide for Leases. The objective of the implementation guide is to provide additional clarification regarding GASB 87, the new governmental accounting...
GASB 13: A Comprehensive Example
Similar to the FASB and IASB, the Governmental Accounting Standards Board released guidance updating the accounting for lease agreements. GASB No. 87, Leases, is effective for applicable governmental entities for reporting periods that begin subsequent to December 15,...
Tool | GASB Lease Tracker
Tool | Present Value Calculation
10 Topics to Consider When Creating an RFP for Lease Accounting Software
Excel used to be, or maybe still is, your “tried and true” go-to for handling lease accounting. However, for some businesses and organizations, accounting for all of their leases with Excel just isn't feasible. ASC 842 has different accounting models for finance vs...
Lease Data for Accounting: How and What to Collect
Adopting ASC 842, IFRS 16, and GASB 87 requires you to revamp your lease accounting practices. In order to transition properly and maintain compliance going forward, you’ll need to collect comprehensive data for each of your organization’s leases. Here’s an overview...