On October 16, the Financial Accounting Standards Board unanimously approved delaying implementation of new lease accounting standard, giving privately held organizations additional time to prepare.
The new lease standard became effective for public companies in January 2019, and was scheduled to go into effect in January 2020 for private companies and nonprofits. A delay was proposed in August, 2019, following complaints about the difficulties of dealing with the transition and implementing the new standard. FASB determined that private companies preparing for the transition would benefit from an additional year in which they could learn from watching how public companies have implemented the rule.
The new effective date for private companies and nonprofits is the fiscal year starting after December 15, 2020. Companies starting their fiscal year in January will have an effective date of January 1, 2021.
The FASB plans to issue a final accounting standard update containing this decision in mid-November.
Questions about implementing the new lease accounting standards for your organization? Please contact Dean Willingham, 505.998.3218, or Michael Jacobson, 602.730.3611.
