Lease Accounting
Lease Accounting is a specialized area that deals with how companies record and report their rental agreements in their financial books. It's like tracking all the items a company rents or leases, from office buildings to equipment, and making sure they're properly shown in financial statements. This became especially important after recent rule changes (ASC 842 and IFRS 16) that require companies to show most of their leases on their main financial statements. Think of it as keeping track of all rental-related costs and commitments, similar to how you would track monthly rent payments for an apartment, but on a much larger business scale.
Examples in Resumes
Implemented Lease Accounting standards (ASC 842) for a portfolio of 200+ property leases
Managed Lease Accounting compliance and reporting for equipment and real estate contracts
Led team transition to new Lease Accounting guidelines across multiple business units
Typical job title: "Lease Accountants"
Also try searching for:
Where to Find Lease Accountants
Professional Associations
Online Communities
Job Boards
Example Interview Questions
Senior Level Questions
Q: How would you handle transitioning a large company to the new lease accounting standards?
Expected Answer: Should discuss project management approach, including assessing current lease portfolio, identifying required changes, training staff, selecting appropriate software, and ensuring compliance with new standards while maintaining business operations.
Q: How do you determine if a contract contains a lease under current accounting standards?
Expected Answer: Should explain in simple terms how to identify lease components, distinguish between service contracts and leases, and evaluate control over assets in various business arrangements.
Mid Level Questions
Q: What's the difference between operating and finance leases?
Expected Answer: Should explain the basic differences in how these types of leases are recorded and reported, including impact on financial statements and typical examples of each.
Q: How do you calculate the lease liability and right-of-use asset?
Expected Answer: Should demonstrate understanding of basic lease calculations, including present value concepts and how to determine lease terms and payments.
Junior Level Questions
Q: What basic information do you need to record a new lease?
Expected Answer: Should list essential lease details like payment amounts, lease term, start date, and any special conditions or renewal options.
Q: What are the main financial statements affected by lease accounting?
Expected Answer: Should identify balance sheet and income statement impacts, showing basic understanding of where lease information appears in financial reports.
Experience Level Indicators
Junior (0-2 years)
- Basic lease data entry and tracking
- Understanding of lease terms and conditions
- Simple lease calculations
- Basic financial statement knowledge
Mid (2-5 years)
- Lease classification and analysis
- Compliance with accounting standards
- Lease software system experience
- Financial reporting for leases
Senior (5+ years)
- Complex lease portfolio management
- Implementation of accounting standards
- Team leadership and training
- Strategic lease decision making
Red Flags to Watch For
- No knowledge of current lease accounting standards (ASC 842/IFRS 16)
- Lack of experience with lease accounting software
- Unable to explain basic lease terms and calculations
- No understanding of financial statement impacts
