By LeaseCrunch® on June 21, 2022 at 10:56 AM
We know what you’re thinking.
Leases don’t go anywhere…why is lease tracking a thing?
It’s admittedly a good question, but here’s the bottomline: Even though leases aren’t “moving”, they are very complicated. And with the new lease standard rolling out, the complications are only piling up.
So with lease accounting compliance rules feeling more and more like an episode of Keeping Up With The Joneses, lease tracking is one of the best ways to make sure your company stays compliant and breezes past its financial audits with ease.
Even better, lease tracking software makes both lease tracking and staying compliant with new lease standards even easier. But let’s not get ahead of ourselves; we’re starting with the easy stuff:
First of All, What is Lease Tracking?
Lease tracking, also referred to as lease management or lease administration is the process of documenting and keeping track of all of the leases a company has.
Why is Lease Tracking Important?
Lease tracking is important for several different reasons. Firstly, lease tracking is crucial when it comes to performing any audits on lease agreements. If leases are not kept up to date, accurate, and available via adequate lease tracking, then audits become difficult and timely to perform.
Secondly, lease tracking is a key aspect to remaining compliant with current GASB, FASB, and IASB rules. And if you didn’t know, these rules get updated often, so tracking your leases accurately and monitoring their compliance is even more important.
Finally, leases aren’t always that obvious in contracts (i.e. “embedded leases”), so making sure all leases are being adequately tracked and organized can avoid scrambling when it comes time to gather financial information for an audit, etc.
What is lease Tracking Software?
Lease tracking software is a preferred tool of lease tracking aficionado’s, and for good reason; this technological innovation helps companies of all types and sizes lease track by performing tasks like:
- Documenting the terms of every lease in a searchable and shareable way
- Automatically creating an audit trail for all changes made to a lease agreement
- Allowing companies to customize the rules for each lease depending on its type to ensure accuracy
Would Lease Tracking Software Help You?
A company should consider investing in a lease tracking software if they:
1. Have troubles finding files and documents when requested?
Studies show that on average, employees spend around 2.5 hours a day looking for information they need to do their jobs. If that sounds like your company's audit season, it’s time to consider investing in lease tracking software.
2. Often run into data errors
Things like mismatched spreadsheets, errors in data entered more than once, and incorrect client information can be as confusing as it can be harmful to your business. Lease tracking software has features like automatic form fill and compliance updates and checks to keep lease information tight, clean, and up to regulatory standards.
3. Have a decentralized lease storage method
Having a decentralized storage system for your leases is confusing, time-consuming, and a potential security risk. Lease tracking software centralizes a company’s leases in a dashboard format, significantly reducing confusion and the time it takes to find any information needed. Furthermore, a good lease tracking software has accessibility settings to allow different levels of access to data for different levels of management.
4. Have one lease or more
As it turns out, lease tracking software can result in an ROI for companies with just one lease agreement! Leases are complicated, so having a tool that allows you peace of mind in knowing that a lease’s information and formatting is correct and compliant is worth its weight in gold.
LeaseCrunch Lease Accounting Software
If any of the pain points above resonated with you, consider trying LeaseCrunch for lease accounting so you can do less work in the long run.
LeaseCrunch software centrailizes your leases into one, easy-to-navigate dashboard. You can invite CPA firms to audit your lease switch multi-level access capabilities, and our software automatically checks for compliance at every step of the lease accounting process.
Reach out to us today about scheduling a free demo.