Manager of Lucernex Lease Analysis products, Mike Hammerslag, discusses his recent trip to CoreNet’s annual conference.
Good Morning! I have just returned from the CoreNet Global Summit in Chicago and I am glad to report that it was a fantastic event.
Perhaps the highlight for me was none other than the Monday morning keynote speech by Greg Lindsay. Mr. Lindsay did the finest presentation on agglomeration (under the guise of changing social dynamics) that I have ever seen! And remember that compliment comes from a former academic who actually taught the topic for 10 years.
But back to the opening quote “There is no opportunity like a crisis!” or perhaps put another way “Don’t waste a crisis!”. Today corporate real estate seems to have its own “opportunistic crisis”, one we should ignore only at our own peril! What you ask? The FASB/IFRS lease accounting change(s), of course!
While I’ll agree with you that the lights will not go off and we won’t be plunged in to interminable darkness once the decision is made, but the decision may be of no less magnitude. The choices are simple:
- Choice 1: plan logically and execute methodically over the next 24 to 36 months,
- Choice 2: throw 10 times the resources at it sometime in 2014.
The process of getting FASB/IFRS compliant will require you to re-abstract your leases to get additional data, re-engineer your departmental processes to be SOX compliant, design and implement new systems to contain the newly required data, re-negotiate debt covenants once you know the impacts to your financial statements, and, lastly, depending on the key metrics contained in your employment contract you’ll need to re-negotiate it so that your pay doesn’t shrink to the equivalent of a poorly paid coffee barista while you manage a 10 million square foot portfolio.
I challenge you to find a better external event, one not caused by you and that you cannot control, BUT one that requires your action. This event gives you the perfect opportunity to ask the C-suite for capital to implement fundamental ground breaking change.
The FASB/IFRS lease accounting change is the opportunity to invest in new systems and new processes today, re-invigorating ourselves, our people, and our departments and averting a real crisis tomorrow!
Shameless Plug
We are ready NOW. Are you? Lucernex’s Lease products have been updated to support the expected new FASB rules. Lx Contracts, our Web-based Lease Administration and Rent Accounting solution, and Lx Lx LseMod version 15, our market leading lease analysis tool, support all of the expected changes NOW and will be updated within weeks of the final FASB pronouncement to ensure 100% support. Lx LseMod version 15 even provides an Old vs. New report to help corporate real estate groups assess the impact of the changes.
For a limited time, for tenants with large retail or corporate lease portfolios, Lucernex will perform a free new vs. old analysis on one lease and provide complete reports showing the potential impact of the new FASB rules. Also, we have already completed portfolio analysis for large retailers providing a detailed assessment of the impact of the proposed FASB rules on their entire portfolio. If you have interest in the free single lease analysis or the complete portfolio analysis please click here to send a request.
[...] CoreNet … “There is no opportunity like a crisis!” “Tentative” – The FASB IASB word of choice! [...]