STRATEGY POLICY INVENTORY DATA
SYSTEM PROCESS
CONTROL SUSTAIN
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ROAD TO LEASE COMPLIANCE
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CONTROL
Data
Whether you have a centralized or decentralized process, it may be wise to
establish or enhance controls around capturing all needed information when
new leases are signed and during the ongoing maintenance of the lease
inventory. You'll need to consider the different types of leases and establish
workflows with appropriate reviews and approvals, as well as maintain an
audit trail for any decisions and interpretations made along the way.
System/IT Controls
When leveraging systems to manage your leases, you'll need to establish
controls over the source data and any interfaces or transfers to ensure data
integrity. Additionally, as these systems will perform financial calculations in
support of the new lease standards, system access controls and segregation of
duties will eliminate errors and potential fraud. Under the Sarbanes-Oxley Act,
companies are required to perform a fraud risk assessment and assess related
controls. Additionally, reviews and approvals through workflows will add a
layer of responsibility to accounting records by proving that transactions have
been seen, analyzed and approved by appropriate authorities.
Third-Party Suppliers
In some circumstances, aspects of your lease portfolio are actually managed by
a third-party supplier, and your ability to know when your leases have changed
– i.e. are modified, renewed, extended or cancelled – can be compromised.
You need to ensure that not only do you have complete information at the start,
but that any modifications are communicated as soon as they happen.
You need to enact robust processes for tracking, reviewing and approving these
changes.
CONTROL
