skip to main content
X

Services

Audit & Assurance

We provide a wide range of audit and assurance services, including financial audit, forensic audit, compliance audit, financial operations, and more.

FASB RELEASES TARGETED IMPROVEMENTS FOR UPCOMING LEASING STANDARD

August 30, 2018

FASB RELEASES TARGETED IMPROVEMENTS FOR UPCOMING LEASING STANDARD

FASB issued ASU 2018-11, which contains targeted improvements to Topic 842 Leases. Among the targeted improvements are a transitional method for reporting during the adoption period and clarification on separating components of a contract for lessors as they relate to FASB's new revenue guidance Topic 606 Revenue from Contracts with Customers. Topic 842 significantly alters current lease accounting under US GAAP. The new standard removes the current approach of classifying leases as either capital or operating leases. For most leases defined under current GAAP as operating leases, Lessees will be required to record a right of use asset and corresponding liability on their balance sheet. Certain exceptions exist for short term leases. Companies will also have to consider all of the costs associated within the lease agreement and the likelihood of any potential renewal when determining the value of the right of use asset. 

The new lease standard is effective for public companies for fiscal years beginning after Dec. 15, 2018. For private companies, the standard is effective for fiscal years beginning after Dec. 15, 2019 and interim periods within fiscal years beginning after Dec. 15, 2020. Early application is permitted.

As this is one of the most significant changes in accounting in recent years, it is important to be aware of the potential impact and get ahead of the application of Topic 842. While the preceding points are not exhaustive, they are just a few of the items that will be considered when applying the new accounting standard. For more information, contact us in one of our many locations.

Audit & Assurance insights

Hide Firm Disclaimer

©2020 UHY LLP. ALL RIGHTS RESERVED.

UHY LLP is a licensed independent CPA firm that performs attest services in an alternative practice structure with UHY Advisors, Inc. and its subsidiary entities. UHY Advisors, Inc. provides tax and business consulting services through wholly owned subsidiary entities that operate under the name of "UHY Advisors." UHY Advisors, Inc. and its subsidiary entities are not licensed CPA firms. UHY LLP and UHY Advisors, Inc. are U.S. members of Urbach Hacker Young International Limited, a UK company, and form part of the international UHY network of legally independent accounting and consulting firms. "UHY" is the brand name for the UHY international network. Any services described herein are provided by UHY LLP and/or UHY Advisors (as the case may be) and not by UHY or any other member firm of UHY. Neither UHY nor any member of UHY has any liability for services provided by other members.

On this website, (i) the term "our firm", "we" and terms of similar import, denote the alternative practice structure conducted by UHY LLP and UHY Advisors, Inc. and its subsidiary entities, and (ii) the term "UHYI" denotes the UHY international network, in each case as more fully described in the preceding paragraph.