© 2018 by 842ware

842Ware For Lessees is an easy-to-use Microsoft® Excel VBA program to help you comply with the new ASC 842 lease accounting standard.  This program prompts you to record relevant lease data, then generates complex calculations for PV calculations and journal entries, and runs reports that help you meet accounting and disclosure requirements. 

 

842Ware for Lessees was created for accountants, accounting managers, controllers, auditors, and other finance  executives.

It can easily be installed and quickly used without having to involve IT or implementing a complex enterprise system.

WHAT IS 842WARE FOR LESSEES?

A standalone lease accounting solution that captures all the relevant data you will need to comply with the new ASC 842 lease accounting standards.

WHO WE TARGET

842ware was created 

for accountants, accounting managers, controllers, auditors, and finance  executives.

HOW IT WORKS

842ware is a standalone Microsoft® Excel VBA tool that can simply be installed to your computer and instantly used without having to involve IT or going through a complex system implementation.

Many accounting firms have said that gathering and documenting information about leases inside a company will create significant extra work for many companies.  842Ware For Lessees is an easy-to-use tool that gives you a framework to capture all the relevant data for ASC 842 compliance.

 

The software captures necessary data about the lease including payment streams, discount rate, cost center/entity, basic asset information, and information that drives the determination of lease classification (operating, financing, or short-term).

842Ware For Lessees generates several key reports in Excel.  Some reports take advantage of Excel's PivotTable feature and graphs to show you the balance sheet and income statement effects of all your leases.  These reports can be changed by the user to filter for legal entity, cost center, lease classification type, or several other fields.

Simple or complex payment streams

 

Many leases have simple payment streams, for example, a 36 month lease with unvarying monthly payments of $795 per month. Other leases may have more complicated streams, for example, a complex real estate lease with payments that change each year for 10 years ("step leases" or "escalating" leases). The 842Ware For Lessees software has a screen that allows you to input up to 24 different sequential payment streams, and will capture either monthly, quarterly or annual  payment intervals, with payments occurring either at the beginning or end or each period.

Lease classification

 

The software gives you a place to answer all the "flowchart" questions to determine lease classification (short-term, operating, or financing).  The questions are ordered from "simple to hard" so that you don't have to chase after hard-to-find information if one of the other easier questions already determines the outcome.  There is a notes section to give you a place to document your results of your review and assessment and any conversations you have with your auditors.

Automated Calculations

The software does all the math for the required calculations of the present value of future lease payments.  This calc is performed at the lease commencement date and then again every month-end, payment date, or change in lease status.  You input the relevant dates and payment information, and 842Ware For Lessees will run the calculations and run double-entry accounting for the entire life of the lease.

Journal entries

 

The software calculates the change in the liability, right-of-use assets, lease expense, interest, and amortization expense as of every payment date and again as of the end of each calendar month.  These entries are shown in Excel PivotTables and other reports, so you'll be quickly book JE's for the start of the lease, each payment, each month-end, and at the finish of the lease.

Reporting and disclosure

The Individual Lease Report shows all the data captured for a particular lease, including classification criteria and result, lessor and asset information, the lease payment schedule, and the accounting schedule.

The Consolidated Lease Report is an Excel pivot table that shows the combined asset and liability balances, lease expense, amortization, and interest for all leases.  Using standard pivot table functionality, the data can be show by month, quarter, or year, and can be split by cost center or legal entity.

5-Year Payment Schedule - This is a simplified view of the data shown in the Consolidated Lease Report; this helps you comply with the 5-year lease payment schedule disclosure required by ASC 842.

Weighted Average Reports - You can run weighted-average discount rate and lease term calculations at a particular balance sheet date; these "show the math" so you can easily understand the figures.

Visualize Lease Accounting Report - This report runs two simple graphs for a particular lease.  One graph shows the cash payments and income statement values (lease expense or amortization & interest); the other shows the balance sheet (right-of-use asset and lease liability).  This report helps you understand lifetime effect of ASC 842 on each lease. 

Lease Modifications and Impairments

If your lease is terminated, modified, or requires impairment, 842Ware for Lessees will help you come up with the necessary accounting entries and post-modification accounting.  The new lease terms can be tied to the original lease.  Post-impairment, 842Ware for Lessees will shift the expense calculations to match the requirements in accordance with ASC 842.  Fixed asset balances for assets acquired related to leases will be calculated based on the write-off of all existing lease balances.