Lease accounting can easily become an administrative and logistical nightmare for many. Companies tend to underestimate the work involved in preparing documents that comply with FASB and other standards. Proper revenue recognition and reporting are particularly difficult for many organizations, and there are also those who do not even know where their lease contracts are.

“Perhaps they use spreadsheets for their fixed-asset accounting and don’t know that they will need to consider modifying their software to perform this accounting. And maybe they haven’t considered the effect that new liabilities on their balance sheets will have on their debt covenants with lenders,” wrote Ken Tysiac of Journal of Accountancy as he discussed the risks of lease accounting laggards.

It greatly helps companies to use the right tools. Below is a rundown of five of the leading lease accounting solutions designed for companies of all sizes but are particularly great for large organizations that deal with a lot of data and contracts.

Trullion

An automated “one source of truth,” this is how the branding of lease software Trullion goes. It may sound somewhat vague, but it is a good catchall for what the software does. This AI-powered lease accounting solution ensures confidence in an organization's financial data by unifying unstructured and structured accounting information.

Trullion makes it easy to collect all relevant information from volumes of documents without necessitating human evaluation. Through a powerful optical character recognition system backed by artificial intelligence, various information including payments, dates, terms, and options are easily extracted from PDF and Excel documents to be recorded in accurate accounting entries that abide by ASC 842, IFRS 16, or GASB 87 standards.

The resulting documents or reports are easily auditable and readily usable for everyone who wants to examine them. Since these documents can be produced rapidly, organizations can expect real-time financial visibility and transparency to ensure that business decisions are guided by up-to-date information and analyses and projections are based on not only relevant but also the latest details.

Trullion makes lease accounting significantly easier and simpler compared to doing everything manually and requiring more people to read documents and encode data into digital records. It may be a relatively new player in the market, but it stands out for the ease and convenience it brings, especially by incorporating AI and machine learning. It is already being employed by a number of global brands including Bell, Nokia HMD, KPMG, and Workrise.

LeaseQuery

Another lease accounting solution designed to ensure compliance to ASC 842, IFRS, and GASB is LeaseQuery. Just like Trullion, it aims to simplify complex accounting and ensure quick turnaround when it comes to recording, analysis, and reporting. It automates the process of turning spreadsheets into standards-compliant accounting records available in secure cloud storage.

What makes LeaseQuery different from Trullion, though, is that it does not come with OCR and AI technology to extract relevant information from PDF documents. It is a SaaS platform designed to make lease accounting efficient, but it could use the AI and document scanning feature to provide an even better experience.

Still, LeaseQuery is one of the most reliable lease accounting software options at present. Its more than 2000 users imply a high level of reliability. It can reduce the costs of lease accounting with its useful critical alerts (for reporting and compliance deadlines), robust reporting tools, and high level of accuracy. Since it is a cloud-based solution, it enables secure access to data and reports anytime and from anywhere. It is a suitable tool for organizations that seek to centralize their lease accounting operations not only across departments but also across different geographic locations.

Visual Lease

Visual Lease is one of the few lease accounting and management solutions that come with advanced features similar to those offered by Trullion. Built to be easy to use, it makes complying with ASC 842, IFRS 16, and GASB 87 a breeze. This lease accounting and administration software built by practitioners offers a comprehensive lease optimization solution with powerful tools and complementary expert services to deal with complex scenarios.

Visual Lease promises next-generation visibility and control as it streamlines workflows across systems and takes advantage of lease data available in different parts and processes of an organization. It features an integration hub that makes it easy to obtain and export lease data wherever it is needed, which eliminates possible duplicate documentation and tasks and saves time and resources. It is also designed with a centralized searchable platform that facilitates the easy capture and tracking of multitudes of unique lease data elements.

Moreover, Visual Lease has a convenient lease history feature that reliable tracks all changes made to a lease, ensuring data integrity and verifiability. It also provides a robust reporting system that allows users to set up their bespoke ad-hoc reports or select from a template library that features more than a hundred standard reports to suit different scenarios.

AMTdirect

This lease accounting and administration software may have been acquired by MRI Software, but AMTdirect remains to be one of the better choices when it comes to accounting for lease operations. In line with what other similar software tools are designed to do, it is aimed at simplifying accounting procedures and lease portfolio management.

It covers not only real estate but also equipment leases, ensuring that important details such as key dates and agreement terms are properly recorded and referenced. It guarantees a massive improvement over manual lease management, as it employs automation and emphasizes the centralization of operations for better oversight and control.

Also, AMTdirect has regulatory compliance in mind. The automation aspect carefully takes into account the IFRS 16 and ASC 842 standards. It can handle all types and classifications of leases. It features CAM reconciliation through its Operating Expense Manager feature. It is designed to rapidly compute disclosures and amortization schedules while simplifying the processing of account receivables and payables.

Other notable features of AMTdirect include the ability to set up an approval hierarchy to keep track of lease changes, the automation of rental payments for better sales and percentage tracking, as well as the ability to schedule custom reports that can be sent automatically to stakeholders. It can generate more than 250 reports for key stakeholders.

CoStar Real Estate Manager

CoStar Real Estate Manager is advertised as “the only commercial real estate platform designed for corporate and retail tenants that integrates market data, research analytics, and management software in one place.” It unifies different aspects of real estate management including lease accounting and administration.

This solution enables real estate managers to achieve better outcomes through various tools including lease and sale comps, lease analysis and modeling, portfolio planning, as well as transaction management. It also has powerful lease analysis and modeling functions that facilitate an organized way of comparing and evaluating the financial implications of different corporate and retail tenant lease proposals from landlords.

Moreover, CoStar Real Estate Manager also makes lease accounting compliance considerably easier by integrating data workflows with critical business systems. This solution is built to simplify the process of complying with ASC 842 and IFRS 16.

CoStar Real Estate Manager enables the quick calculation of the balance sheet impact of certain leasing decisions while expediting the process of inputting monthly journal entries and reporting accurate financial disclosures. It does not have the AI and machine learning bells and whistles of other more advanced solutions, but it is reliable enough to be regarded as one of the leading options.

Choose the best solution for your needs

Different organizations have different needs and preferences when it comes to lease accounting and administration. Generally, it is advisable to choose a specialized software solution that focuses on lease accounting and management. However, it is not a bad idea to use multifunction platforms whose other features are also useful to an organization’s record-keeping and management needs.

The five lease accounting software tools above represent the best options available at present. They provide a wide range of functions and sport high reputability among users. Choosing the right one is a matter of finding the one that perfectly suits an organization’s requirements in view of usability and integration with other existing software tools.