How to set up Lease Accounting in NetSuite

Lease accounting can be complex, especially with the rigorous standards set by ASC 842 and IFRS 16. Whether your business leases office space, equipment, or vehicles, proper lease accounting is essential for compliance, accuracy, and efficient financial management. NetSuite offers capabilities to streamline and automate lease accounting, helping businesses achieve full compliance while saving time and reducing errors.

Lease accounting involves tracking and reporting the financial impact of leases, which can include buildings, equipment, and other assets that businesses rent over time. Standards like ASC 842 and IFRS 16 require companies to accurately report lease costs and obligations on their balance sheets, ensuring a clear picture of their financial position. This means recording both the value of leased assets and any ongoing lease payments, as well as recognizing related income and expenses.

NetSuite’s Lease Accounting, part of its Fixed Assets Management SuiteApp, simplifies this process by helping businesses stay compliant with lease accounting standards. Through NetSuite, companies can create and track lease records, set up automatic payment schedules, generate amortization schedules, and handle related journal entries. With these tools, NetSuite enables smooth lease tracking and compliance with standards, while offering real-time visibility into all lease-related transactions.

NetSuite’s Lease Accounting within Fixed Assets Management offers a range of advantages, enabling businesses to manage lease compliance and financial tracking effectively. Here are the key benefits:

• Regulatory compliance: Meets ASC 842 and IFRS 16 standards, ensuring lease obligations are properly reflected on the balance sheet.
• Automated lease management: Streamlines the creation of lease records, payment schedules, and journal entries for increased efficiency.
• Real-time financial visibility: Provides a comprehensive view of lease assets, liabilities, and expenses for informed decision-making.
• Accurate asset valuation: Automatically adjusts the value of lease assets and liabilities as conditions change throughout the lease term.
• Efficient transaction processing: Integrates lease records with NetSuite’s financial management features for faster processing and reliable reporting.

Setting up lease accounting in NetSuite starts with configuring key aspects such as lease categories, accounts, and financial settings in the Fixed Assets Management SuiteApp. Once you’ve installed the Fixed Assets bundle, you can establish accounts for Right-of-Use Assets, Lease Liabilities, Interest Expenses, and Lease Expenses. These accounts help categorize and manage your lease assets, track payments, and maintain compliance with accounting standards. From there, you can create and customize each lease record by entering details such as the lease type, start and end dates, payment frequency, and any classifications that align with your accounting structure.

After setup, NetSuite’s Lease Accounting tools allow you to manage the lease lifecycle smoothly. You can generate lease amortization schedules, create lease-related journal entries, and automatically track payments. This streamlined approach gives your team accurate, real-time lease data and integrates it into your broader financial reporting.

Implementing NetSuite Lease Accounting can be a significant upgrade for your organization, and Rand Group offers the expertise to make it a seamless process. Our team specializes in configuring NetSuite, ensuring your lease accounting is accurate, compliant, and tailored to your business needs. Whether you need assistance with initial setup, ongoing support, or optimization, we provide comprehensive services that help you get the most out of NetSuite’s lease accounting capabilities.

• Custom configuration of lease settings to match asset and liability structures
• Guidance to ensure compliance with ASC 842 and IFRS 16 standards
• Data migration support for a seamless transfer of existing lease data
• Ongoing optimization to adapt configurations as business needs evolve
• User training on best practices for efficient lease management

With Rand Group’s dedicated support, you can confidently manage leases with efficiency and compliance.

NetSuite Lease Accounting streamlines the complexity of managing lease obligations, automating compliance, and maintaining accurate financial data. By leveraging the expertise of a trusted partner like Rand Group, you can implement and maintain NetSuite Lease Accounting with confidence. If you’re ready to enhance your lease accounting practices and fully utilize NetSuite’s features, contact Rand Group today for personalized support and expertise.