IFRS 16 – Are you ready for system support?
From January 2019, major changes will take place for companies that submit accounts in accordance with IFRS. IFRS 16 arrives, and this has great significance for the company’s key figures.
25. September 2018
On September 14, FSR.dk published an article focusing on some of the points that the Danish Business Authority has submitted as amendments to the Danish Financial Statements Act.
Changes are proposed to ensure that Danish companies live up to the international standards for e.g. IFRS 16 concerning leasing.
IFRS 16 equates financial and operating leasing, which means that operating leasing assets must be recognized in the company's accounts on equal terms with the financial leasing assets. One consequence of this is that many leases are involved and thus have to be recognized in the balance sheet.
Naturally, this imposes an additional administrative burden on companies, which the IBM Planning Analytics Solution Accelerator for IFRS 16 can help make system-supported.
Answering the following questions makes the IBM Planning Analytics Solution Accelerator for IFRS 16 relevant to the company.
Is the asset in the contract an identified physical asset? (Vestergade 4, frame number XX-YY-ZZ)
As a tenant/lessee, do you have the right to dispose of the asset during the contract period?
Is the term of the lease/leasing contract more than 12 months?
Is the sum of the rental/leasing obligation greater than USD 5,000 during the contract period?
The right to obtain financial benefits from the use of the asset
The solution can assist with:
Administration of contracts
“Right of Use asset” calculations
Lease liability calculations
Preparation of financial statements in accordance with IFRS 16
Integration with ERP system/consolidation system
Preparation of notes
Handling multiple currencies
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