LUTZ BUSINESS INSIGHTS
governmental and non-profit lease standard implementation for 2022
paul baumert, healthcare consulting shareholder
Governmental Healthcare Organizations
The Governmental Accounting Standards Board (GASB) issued Statement No. 87, Leases in June of 2017. For reporting periods beginning after June 15, 2021, lessees will now be required to recognize a lease liability at the present value of expected payments net of incentives and an intangible right-to-use asset for all leases with a term greater than 12 months. When payments are made, the liability will be reduced and interest expense recognized.
Non-Profit Healthcare Organizations
The Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2016-02, Leases (Topic 842) in February of 2016. For reporting periods beginning on or after January 1, 2022, lessees will now be required to recognize assets and liabilities for leases with terms of more than 12 months. The standard requires the lessee to recognize interest expense and amortization of the associated expense.
We recommend the healthcare organizations subject to the new lease standards above review the applicable standard and prepare for implementation. If your organization has questions about implementation or needs assistance, please contact us.
ABOUT THE AUTHOR
PAUL BAUMERT + HEALTHCARE CONSULTING SHAREHOLDER
Paul Baumert is a Consulting Shareholder at Lutz with over 20 years of experience in accounting and consulting for healthcare and nonprofit industries. He specializes in the areas of financial management support services and reimbursement analysis.
AFFILIATIONS AND CREDENTIALS
- Nebraska Society of Certified Public Accountants, Member
- American Institute of Certified Public Accountants, Member
- Healthcare Financial Management Association, Member
- Certified Public Accountant
- Fellow of the Healthcare Financial Management Association
- BSBA, Creighton University, Omaha, NE
- Skutt Catholic High School, Board Member, Finance Committee Chair
- Elkhorn Public School Foundation, Past President
- Iowa Healthcare Financial Management Association, Past President
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