Equipment and property rental firms use lease accounting software to keep track of their income and costs. Payments will be tracked, bills will be sent, and financial reports will be generated by the accounting system. Real estate professionals and equipment rental organizations who need to verify that their financial records meet FASB and IASB standards are the most typical users of these solutions.
15 Best Lease Accounting Software in 2023
The new rules from the FASB and IASB require complicated calculations to figure out which leases must be included on the balance sheet in order to stay in line with the new rules. Lease accounting software automates these computations, ensuring that you meet all reporting requirements. Even if requirements change over time, having an up-to-date solution will keep you compliant. Lease data may be stored in several lease accounting solutions. You can keep track of lease terms, renewal deadlines, and tenant contact and payment information in this way.
Features of Lease Accounting Software
Feature Description Accounting for Money
- Keep track of your rental revenue and costs.
- Invoicing and billing Create and mail rental payment invoices.
- Set up recurring invoices to receive payments on a regular basis.
- Reporting on Money Create reports that follow the ASC 842 and IFRS 16 guidelines.
- Managing Leases Organize lease information, such as terms, asset descriptions, and lessee details.
Financial Management Lease Accounting Software
Lease accounting software manages the financial portion of your rental business. All rental income will be tracked by the system. Payment schedules can be set up to be deducted from a customer’s bank account or charged to a credit card on a specific date. Security deposits and late fees might be added to the bill as well. Budgeting is also made easier using lease accounting software.
Bank fees, maintenance and repair costs, legal fees, and other expenses must all be tracked by rental firms. Rent payments, late fines, and security deposits will all be tracked by the system. To make sure you’re making money and meeting your financial goals, compare your budget to your actual finances over a period of time.
Lease Accounting Software: Financial Reporting Standards
In order to keep track of both existing and new leases in a way that meets both local and international accounting standards, you need a lease accounting solution. The FASB ASC 842 and IFRS 16 are two of the most widely used standards.
ASC 842 of the FASB
The Financial Accounting Standards Board (FASB) issued ASC 842, an upgrade to ASC 840. ASC 842 compliance reports, such as amortization of right-of-use (ROU) assets, cash flows, interest on lease obligations, variable lease costs, comprehensive disclosure reports, and more, are made possible by lease accounting systems.
The new FASB ASC 842 standard isn’t very different from ASC 840 in terms of how leases are classed. Leases are classified as either financial leases (capital leases) or operating leases under both criteria. Operating leases were formerly exempt from being recognized on the balance sheet. If you have an operating lease that lasts more than 12 months, that lease must be shown on your balance sheet under ASC 842.
IFRS 16
The International Accounting Standards Board has issued a new standard called IFRS 16. (IASB). Your reports will be compatible with these international standards thanks to lease accounting software. Assets worth more than $5,000 and lease durations of more than 12 months must be reflected on the balance sheet under IFRS 16. Short-term leases and low-value assets, on the other hand, must still be declared.
Beginning on January 1, 2019, the IFRS 16 lease standard will be used for all reporting periods that start on or after that date. To promote balance-sheet transparency, this standard superseded IAS 17. Many leases that were deemed operational leases may have been kept off the balance sheet, whereas financing leases had to be included.
IFRS 16 considers almost all leases to be finance leases, so there is no longer a difference between the types of leases. LeaseQuery’s IFRS 16 reports include amortization of ROU assets, cash flows, interest on lease obligations, weighted average discount rates, and weighted average lease durations. These are all included in the reports.
Asset-Level vs. Portfolio-Level Lease Accounting
Lease accounting software can keep track of transactions at the portfolio or asset level. In portfolio-level lease accounting, all of the transactions for a single lease contract are grouped together. For leases with only one asset per contract, this method of accounting is perfect. Asset-level lease accounting records each and every asset included in a contract. One lease contract, for example, covers numerous segments or offices within a building. Each asset in a lease arrangement must be reflected in financial statements according to both ASC 842 and IFRS 16.
Lease Management Software
Lease accounting software is often combined with lease management and lease administration software to make a complete package. There is a lease management system that helps keep track of lease portfolios and tenants and customers as well as paperwork, deadlines, and more. The system’s lease information may be simply updated.
The solution stores important data, like the length of the lease, the rate, the expiration date, and the name of the tenant or client. You may also add lease contracts and other vital papers to make it easier to access them when needed. You will be told about upcoming deadlines and other important dates through the system. The system will send you a notification if a payment is missed or if your lease contract is about to expire.
Lease Accounting vs. Lease Management: What’s the Difference?
Several systems offer lease management as part of the accounting system. For public financial disclosures, lease accounting software can help you make them. You can also use it to track revenue and costs. On the other hand, lease management software keeps track of lease data and automates lease renewals, terminations, and buyouts. Having both lease accounting and lease administration in one system guarantees that all accounting rules are met and that lease conditions are kept in one location. As soon as you sign a new lease, renew an old one, or end a lease, your lease management software may automatically update the accounting side of things.
Lease Accounting Software Can Handle a Variety of Leases
Anyone who rents out their assets will benefit from lease accounting software. Lease accounting software can help you handle the following leases:
Leases for both residential and commercial real estate
Real estate lease accounting software is used to keep track of revenue from commercial buildings, flats, duplexes, and other assets that rent. Lease agreements will also be stored in the system, allowing you to keep track of agreed-upon terms. People who don’t pay their rent on time or who want to end their contract will be told by the lease software. Commercial and residential real estate leasing may both benefit from all-in-one property management software. Accounting, tenant administration, work order management, and other functions are all handled by these systems.
Leased Equipment
GPS tracking and asset management are examples of advanced lease management software capabilities. This allows you to keep track of your equipment’s whereabouts in real-time. The system also keeps track of the state of your equipment. Knowing when your equipment was serviced and when important preventative maintenance dates are coming up may help your equipment last longer, but it’s not a sure thing. Equipment rental software and fleet management software are examples of industry-specific software. Lease administration, accounting, asset monitoring, and other features are included in these systems.
Contracts of Employment and Service
Lease accounting software helps businesses keep track of the revenue and costs that come from hiring outside help. When small and medium-sized businesses need to hire someone else, they might use a professional employer organization (PEO). PEOs, also known as employee leasing companies, hire personnel to assist organizations with responsibilities such as training, payroll processing, hiring, and performance management.
Lease accounting software will keep track of how much the business pays for the services it has already provided, as well as how much it has agreed to pay. If extra equipment was needed for the service, those costs might be added to the total cost of the bill.
1. LeaseQuery
An accounting tool called LeaseQuery meets the requirements of FASB ASC 842, IFRS 16, and GASB 87. Error-free amortization plans and journal entries, as well as key date alerts and data entry checks, are all important parts. Public and private leases are also possible using LeaseQuery.
2. Visual Lease
Visual Lease is a real estate and equipment lease management software that does both business lease accounting and lease administration in one package. It does both in one place. This solution works in conjunction with ERP systems to provide you with comprehensive control over your company…
3. LeaseAccelerator
LeaseAccelerator is a lease accounting software tool that makes sure your company is following ASC 842, IFRS 16, and GASB 87 rules. LeaseAccelerator synchronizes your leases with SAP, Oracle, and other ERP systems.
4. CoStar Real Estate Manager
CoStar Real Estate Manager is a collection of tools that help with both real estate and lease management. You’ll be able to make better business judgments if you have access to accurate real estate and lease data. This solution will guarantee you.
5. AMTdirect
AMTdirect is a web-based lease accounting tool that helps companies save money and better manage their real estate assets throughout their life cycle.
6. UGAAP
Lease accounting software that keeps lease information and documentation organized. This cloud-based and on-premises solution organizes journal entries, maintains an audit trail of people who make lease adjustments, and provides
7. iLeasePro
ILeasePro is a highly scalable, cloud-based solution for large or mid-sized businesses and includes complete lease management and lease analysis tools that are designed to lower costs, manage risks, and improve lease business intelligence.
8. TURBO-Lease
TURBO-Lease is a lease accounting software that can handle a wide range of equipment and vehicle lease portfolios. It is simple to use and designed for Microsoft Windows, yet its power, versatility, and completeness are much beyond alternatives that cost many times more.
9. Odessa Platform
The Odessa Platform is a full-leasing software solution that runs over the internet. Its 120 programmable modules completely automate leasing organizations’ operations. This is complemented by its lease accounting software capabilities: the accounting
10. MRI ProLease
The ProLease Real Estate and Facilities Management software is made up of four interconnected modules that are both sophisticated and simple to use. These best-in-class solutions integrate smoothly or may be used independently.
11. EZLease
Lessees and lessors can use EZLease to comply with the most recent lease accounting standards, such as IFRS, ASC, and GASB. This software is easy to use and straightforward, and it doesn’t require any prior knowledge of new or old standards.
12. Nakisa Lease Administration
Nakisa Lease Administration is a lease accounting and administration software that keeps all of your lease information in one place. This software helps you manage lease portfolios, improve accounting, and gain a better understanding of your financial data.
13. Soft4Lessee
Soft4Lessee is lease accounting software that can be used in the cloud or on your computer. It can be bought as a subscription service (SaaS). This solution takes care of all the complicated calculations required to ensure that your leases comply with IFRS 16 and ASC 42.
14. CCH Tagetik
CCH Tagetik is a cutting-edge software that integrates all of your company’s financial procedures. Lease accounting multi-GAAP reporting includes IAS, IFRS, and other multi-GAAP reporting standards.
15. OnCite
For real estate and government agencies, OnCite property management software enables lease accounting. It includes tools for gathering requirements, customizing, converting, integrating, testing, training, support, and system hosting, among other things.