Top 5 Reasons to Automate Lease Accounting
Right now in Texas, the task of finding and hiring a good accountant is insanely difficult. Candidates have been in the driver seat for the last several years as more corporate headquarters have moved here from other states. In Dallas, if you find a reliable, qualified candidate you better be willing to pay top dollar, be quick with your offer, and be prepared to have a conversation about your remote-work policy.
How is the market where you are? Have you been tempted lately to settle for less than qualified candidates? Don’t do it! Settling leads to more headaches, and in my experience as a controller leading teams over many years, it just isn’t worth it.
So building a great team of dynamic, sharp accountants is difficult and takes some perseverance and patience, but it is not impossible. And once you have a great team in place, how are you going to utilize these talented individuals in a way that keeps them motivated, engaged, and growing in their career?
If you said, “saddle them with a hundred spreadsheets that they have to update each and every month”, that is NOT correct! I know this from first hand experience!
If you said, “force everyone out of spreadsheets and into a big fancy expensive cloud ERP system that doesn’t really do everything we need it to do”… now that’s just ridiculous, who would say that!
If you said, “let my best people explore and implement tools that can help eliminate the most tedious, repetitive, complicated, and error-prone tasks”, now that is an interesting thought…
Where should we begin? How about Lease Accounting (since that’s what this article is supposed to be about).
Here are my top 5 reasons why you should challenge your team to automate Lease Accounting:
#5. Lease Accounting is Complex
Wait a minute, I thought automation was only for standardized, high volume, simple transactional processes. Not so, my friend! We’ll get to volume in a second, but in terms of simple versus complex, I would argue that automation is more valuable where there is complexity. If something is complex, you will most likely give it to your best accountant. Immediately you should be thinking of opportunity costs. Why not employ a specialized tool that already contains all the complex logic and then give the task to a more entry-level team member (cheaper—you were thinking it, I said it, let’s move on)?
#4. You Have 20+ Leases
Let’s talk about volume, and more specifically, let’s talk about off-the-shelf automation versus custom automation. Custom automation sounds big, scary, expensive, and hard to maintain—not necessarily. Actually, this type of automation can be extremely rewarding and can lead your team to achieve things you never imagined, but will require a commitment to operating at a higher level beyond spreadsheets. But that is a topic for another day—today we are talking about something much easier. Lease Accounting may be complex, but the rules are the same for everyone. Standardized and complex—this is the ideal scenario for off-the-shelf automation. You don’t need high volumes to reap the benefits of off-the-shelf automation. The investment and expertise that went into putting the automation tool on the shelf is spread across every end-user who buys from the shelf. That’s the greatness of specialization and capitalism. Who loves capitalism… I do!
# 3. Get Instant Data Integrity
Do you have data integrity in your spreadsheets? “Sure, I have my best accountant on it.” Please re-read #5. The right tools have built-in data integrity checks. Excel sheets adopt the data integrity philosophy of whoever happens to own them next. Sure, you could simply exert your influence and correct errant behavior during workpaper review, but I will ask you to think about that while you read #2.
# 2. Save Review Time
When you invest in a tool that does all the lease accounting calculations and reporting for you, you also save time in so many other areas, like review time, training time, dreaded spreadsheet validations time (you are doing this, right?), footnote gathering time, gathering audit support time, etcetera.
# 1. Implementation is Easier Than You Think
First of all, let your team drive this automation project. You stay out of it until they ask for your input or a decision. This empowers them, let’s them grow their skill sets in planning and discernment, and it makes work more fun. Secondly, show your talented team that you are willing to invest in them and you are willing to invest in the tools that make their work more enjoyable. Lastly, I know of one lease accounting tool that will enable your team to upload all of your leases from an excel sheet with just a few clicks. Your team might not tell you how simple it is, so I will tell you now—it makes life pretty simple.
With the right tools and an empowered team, you will be amazed at what you can accomplish and at how quickly it gets done. Now go inspire your team to make something great happen!
Stan Bimmerle, CPA, CMA
Founder of Lease Ledger
