The lease liability is defined as the present value of your future lease payments. Transitioning to ASC 842, IFRS 16, and GASB 87 can be difficult, but there are resources that can help you gain an understanding of the methods laid out below for our calculations. You can use the information in this blog to ensure that your chosen software provider is performing this calculation accurately. Private companies in particular may be tempted to try to use an Excel spreadsheet for lease accounting, but this information is important even if you plan to use lease accounting software for compliance with the new standard. In this article, we will demonstrate how to calculate the present value of your lease payments as well as prepare the liability amortization schedule for the lease liability in the same step, using Excel.
Previously, we covered how to calculate the present value of lease payments using Excel spreadsheets.
