Implemented accounting standards codification

Implemented accounting standards codification

Accounting Standards Codification (ASC) 842, Leases, is effective for private companies with fiscal years beginning after December 15, 2021. As a result, Stout's client was required to adopt the standard as of January 1, 2022.

The scope of the engagement was to assist the Company with its implementation of the standard, including the following:

  • Identifying all contractual arrangements that met the definition of a lease in accordance with ASC 842
  • Extracting all relevant data from each lease
  • Calculating the lease liability and right-of-use (ROU) asset for the Company's lease portfolio, including all transition and ongoing journal entries through the end of the lease terms
  • Drafting audit-ready technical accounting memoranda
  • Drafting the financial statement footnote disclosures
  • Creating a template that the Company could leverage for lease arrangements entered into after adoption of the standard

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