Employing financial technology solutions has become a comfortable and productive way of life for many corporate finance leaders, who increasingly rely on these cloud applications to optimize and enhance a core piece of their jobs, from treasury to accounting and beyond.
On Friday 29 March 2019, the UK will formally leave the European Union (EU). Although a transition period should apply from that date until Thursday 31 December 2020, it is not yet clear what the UK’s relationship with the EU will look like after that, especially as a trade deal between the two has not been agreed. The uncertainty is causing concern for UK corporates who are forecasting hypothetical scenarios. In fact, it is possible that there will be no transition period at all, if a withdrawal agreement has not been signed by the date of the UK’s departure.
Adoption of lease accounting standards such as IFRS16 is less than a year away, with regulations effective as of January 2019. Yet, with over two years to prepare already, most corporates report not being ready for the transition. In fact, most treasurers are either unaware of or not involved with their organization’s lease accounting project planning. This is a serious problem as lease accounting experts are finding that uncovering the full magnitude of lease contracts takes at least 12 months to complete.
Why is lease accounting so difficult?