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Revised Statement of Direction for Property Manager Compliance with IFRS 16 and ASC 842

As explained in earlier post on 2nd Aug 2016, The IASB (International Accounting Standards Board) and FASB (Financial Accounting Standards Board) have made some major changes with respect to accounting standards for leases. To meet these new standards for leases, property tenants and equipment lessees are required to make significant changes in accounting and reporting for most leases (i.e., rental contracts) on their balance sheets as lease liabilities with corresponding right-of-use-assets.

In view of these new requirements, Oracle product management team has shared high level changes that are planned enhance Oracle Property Manager to address the requirements on 5-July-16. The earlier shared statement of direction was mainly related to operating Leases.

Now a revised statement of direction has been released which includes Equipment leases as well. Currently, many equipment lessees initiate their contracts through procurement and account for rental as an accounts payable expense. Oracle E-Business Suite intends to address the requirements for equipment lessees to recognize lease rental contracts on their balance sheets as lease liabilities with corresponding right-of-use-assets.

For more information on the high level changes that are planned now and how Oracle Property Manager product strategy is planning to meet these requirements, refer to the community posting PN Statement of Direction 29th Nov 2017.

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