Simplifying the financial reporting of leasing arrangements

Description

Abstract: Many construction companies create separate, but related, business entities to buy vehicles, equipment or facilities and then lease these assets back to the parent company. They may now be able to avail themselves of a simpler way to handle the financial reporting of these arrangements. New Financial Accounting Standards Board guidance allows private companies following Generally Accepted Accounting Principles to, in some circumstances, elect not to consolidate the financial reporting from such entities that lease property to them. This article offers examples of how it works and who may qualify.