GASB 87 and GASB 96 Background / Overview
In June of 2017, the Governmental Accounting Standards Board (GASB) introduced GASB 87 as a new set of accounting standards for lease agreement accounting. GASB 87 introduces new requirements for lease accounting, including the recognition of lease assets and liabilities on the balance sheet for operating leases with terms of more than 12 months. This ensures that state and local government entities report lease liabilities on their balance sheets and disclose key information regarding lease agreements in their financial statements.
On March 2021, due to the rise of cloud-based software, GASB issued Statement 96 (GASB 96) to address accounting treatments and financial reporting of Subscription-Based Information Technology Arrangements (SBITA). State and Local Government entities must comply with these requirements; and for clients who are using SAP as their ERP/ Financial System, the question is how can we use SAP ECC/ S4HANA to address these accounting standards.
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SAP Solutions for GASB 87 and GASB 96 Compliance
SAP ERP Systems (ECC and S/4HANA) offers a complete set of solutions that can be used to comply with GASB 87 and GASB 96 standards. The implementation scope includes activation of SAP Flexible Real Estate Management (REFX) with SAP Contract Lease Management (CLM), and with integration to the FI modules of General Ledger, AP/AR Accounting, and Asset Management.
These components, when fully integrated, will provide compliance to GASB 87 and GASB 96 with features such as lease classification, journal entry generation, and disclosure reporting.
GASB 87 and GASB 96 Implementation Services Provided by Phoenix Business Consulting
Phoenix Business Consulting has a deep breadth of experience with GASB compliance through the implementation of SAP Contract, and Lease Management (CLM).
Our services include:
- Implementation Planning: Our team of experts will work with your organization to understand its specific needs and develop a project plan to implement SAP software solutions for GASB 87 and GASB 96 compliance.
- System Preparation. In order to implement the REFX/CLM module, the ERP system should be updated to the correct support stack. Phoenix will work with your BASIS team to bring the system to acceptable support pack.
- Solution Configuration: Once the implementation plan is in place and the system is ready, Phoenix Business Consulting will configure the required SAP software solutions to meet your organization’s requirements. This includes setting up lease accounting rules, chart of accounts, and other system settings. We can also create custom ABAP reports to suit your needs.
- Data Migration: If your organization has existing lease data, our implementation team will migrate this data to the new system. Data cleansing and normalization may be required to ensure accurate reporting.
- Testing And Training: Before the system goes live, Phoenix Business Consulting’s implementation team will conduct thorough testing to ensure that the system is functioning as expected. End-user training will also be provided to ensure that your staff are familiar with the new system and can use it effectively.
- Post-Implementation Support: Once the system is live, post-Implementation support will be provided to ensure that any issues are resolved quickly and provide the required assistance in scope.
Phoenix Business Consulting’s specializes in SAP software solutions for GASB 87 and GASB 96 compliance. We can help your organization based on your specific needs, and timeline. Since 1998, over our 25+ year history, we have provided SAP implementation, SAP software solutions, and SAP support services to over 150+ Public Sector agencies and commercial organizations.
Want to learn more about SAP software solutions for GASB 87 and GASB 96 compliance?
Schedule your GASB 87 and 96 compliance discovery call with Phoenix Business Consulting today!
