FASB Lease Accounting Changes and the Bottom Line: What Corporate Real Estate Needs to Know

FASB Lease Accounting Changes and the Bottom Line: What Corporate Real Estate Needs to Know


April 2010

FASB Lease Accounting Changes and the Bottom Line: What Corporate Real Estate Needs to Know Moderator: Kenneth Rudy, Managing Director, Corporate Solutions, Jones Lang LaSalle Speakers: Mindy Berman, Managing Director, Jones Lang LaSalle Brad Homant, FASB Practice Fellow Erik Lange, Partner - Transactions & Restructuring - Transaction Accounting Services, KPMG LLP Under new accounting rules proposed by the Financial Accounting Standards Board (FASB) and the International Accounting Standards Board (IASB) slated to be issued in 2011, companies could receive a massive shock as all leases of real estate and equipment will have to be capitalized on a company's balance sheet. A recent survey conducted by Jones Lang LaSalle and CoreNet Global found that 99 percent of corporate real estate executives are substantially unprepared for a proposed major change in national and international accounting treatment of real estate lease obligations. Sixty six percent of respondents said the changes would have a significant or major impact on the size of their company's balance sheets. Representatives from JLL, KPMG, and FASB will present the new proposal and discuss the ramifications of capitalizing an estimated $1.3 trillion in operating leases by U.S. public companies.

Keywords: FASB 13, Lease Management, Lease Accounting,

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