Step 3: Setup Reporting Entity

Setup Reporting Entity, Select Accounting Standard, Initial Application Date, Local/Functional Currency, Add Location

These settings are available for users with the Administrator Role.

• Reporting Entity: A Reporting Entity is the entity for which financial statements are produced. At least one Reporting Entity must be created for in order to enter leases into LeaseCrunch. When creating a Reporting Entity, determine the following:
• Accounting Standard: FASB ASC 842 or IFRS 16. (Does not apply to GASB)
• Initial Application Date: This is the date as of which the Reporting Entity will adopt the standard. See Additional Guidance below.
• Local Currency: Identify the local currency for the Reporting Entity. This is the currency used to pay lease obligations. (Does not apply to GASB)
• Functional Currency: Identify the functional currency for the Reporting Entity. This is usually either the local currency or the currency of its parent company. (Does not apply to GASB)

• Location: For each Reporting Entity, you have the option to add a Location. Locations can be added from the Add Lease screen.

To Disable a Reporting Entity, an administrator can edit the entity and uncheck the Enabled checkbox. Navigate to Administration - Reporting Entity and click the blue pencil to edit the Reporting Entity.

 

When selecting the Initial Application Date, keep the following information in mind and view this article about Initial Application Date.

• The Initial Application Date is the first of the fiscal period in which you are adopting the standard. For most organizations following ASC 842, this is January 1, 2022. 
• What are incorrect Initial Application Date's? 
  • January 1, 1900
  • March 1, 1896
  • January 1, 2010
    
    
• Use the Initial Application Date calculator to determine the correct Initial Application Date