GASB 87 Compliance
GASB 87 Overview
GASB 87 is the new lease accounting standard issued by the Government Accounting Standards Board (GASB). It governs how public entities calculate, account for, and report on leases.
What does it mean for my business?
GASB 87 applies to leases defined as “contracts that convey control of the right to use another entity’s nonfinancial asset (the underlying asset) as specified in the contract for a period of time in an exchange or exchange-like transaction”. The standard doesn’t apply to leases of intangible assets (including computer software), biological assets, inventory, or supply contracts.
What is GASB 87 compliance?
To stay compliant with the GASB 87 lease accounting standard, you’ll need to invest in software that automatically identifies important pieces of information, such as lease commencement dates and amounts. By simply uploading PDFs and letting the software to do all of the heavy lifting for you, you can automatically recognize lease assets and liabilities on your Statement of Net Position — thus staying compliant with this standard and keeping your business on the right track.
