Implementation Proves Challenging, but Silver Lining Emerges as Organisations Realise Benefits After Adoption
SYDNEY — 4 December 2019 — the majority of ANZ and APAC companies will still be working towards full compliance with the IFRS 16 lease accounting standards well into 2020, according to a new poll released by LeaseAccelerator, the pioneer in the Enterprise Lease Accounting software market, and RGP, a multinational business consulting firm.
Conducted with 163 executives from Australia, New Zealand and the wider APAC region, the poll results showed that more than 50% of organisations were still working on compliance for the new standards which began to take effect at the beginning of 2019. Organisations are finding data collation and discount rate determination equally cited as the biggest areas of concern.
Looking past the compliance phase, respondents said they expected simplified budgeting, forecasting and planning for future lease expenses to be a key benefit as a result of the enhanced systems and controls being implemented to meet IFRS 16 requirements.
LeaseAccelerator’s CEO, Michael Keeler, said the benefits of IFRS 16 were being realised by companies who had fulfilled the compliance requirements and now enjoy higher levels of visibility and automation from their lease portfolio.
“We call it the silver lining,” he said. “It’s not just about compliance with the new financial reporting requirements – it’s about efficiency and savings from stronger systems, processes, and controls for the lease portfolio.”
Sebastien Normand, VP Revenue and Country Lead Australia, RGP said the key to success was cross-functional cooperation and good communication.
“This change impacts the whole organisation and requires lots of communication between accounting, procurement, real estate and operations functions,” he said. “Once implementation is done, the next step is to have a clear process in place to ensure continuity, and accurate and up to date information managed by people who are strongly engaged.”
A webinar with pointers for organisations still grappling with IFRS 16, as well as those looking at day two and beyond, is available at https://explore.leaseaccelerator.com/webinar-ifrs-16-are-we-there-yet-yes-we-are/. Featuring Sebastien Normand, Michael Keeler, and LeaseAccelerator’s VP Solution Consulting Michelle Laybutt, the webinar gives useful guidelines and case studies on maximising the return on investment in IFRS 16 compliance.
LeaseAccelerator offers the market-leading SaaS solution for Enterprise Lease Accounting, enabling compliance with the current and new lease accounting standards. Using LeaseAccelerator’s proprietary Global Lease Accounting Engine, customers can apply the new standards to all categories of leases including real estate, fleet, IT and other equipment at an asset-level. On average, LeaseAccelerator’s Lease Sourcing and Management applications generate savings of 17 percent on equipment leasing costs with smarter procurement and end-of-term management. Learn more at http://www.leaseaccelerator.com.au.
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RGP is a global consulting firm that enables rapid business outcomes by bringing together the right people to create transformative change. As a human capital partner for our clients, we specialise in solving today’s most pressing business problems across the enterprise in the areas of Business Transformation, Governance, Risk and Compliance and Technology and Digital Innovation. Our engagements are designed to leverage human connection and collaboration to deliver practical solutions and more impactful results that power our clients, consultants and partners’ success. To learn more about RGP, visit: http://www.rgp.com.