With advancing technology, most firms have upgraded to lease accounting software to improve efficiency and centralize their database. It can prepare your business to make accurate financial reports by doing complex calculations, so you don’t have to. This automation saves you time and money. Many firms have realized the importance of the advantages of leasing software, which is why 64% of small or midsized businesses use these accounting tools to streamline their work processes and gain an edge over competitors.
That said, how do you choose the best software for your company? A great leasing tool can help you manage your growing number of leases by providing the following benefits.
1. Enables Compliance
Lease compliance means adhering to the agreements and conditions of your leasing contract. Each party involved in the leasing contract must comply with it, which covers many things. For example, if you’re leasing property, then your tenant must comply by paying rent on time. Similarly, you must pay for maintenance and repairs as a tenant. These rules protect the rights of everyone involved, and failure to comply results in compliance issues. The most common complaint is unpaid or late rent, with around 6 million American renters being behind on rent this fall.
You can use leasing software to ensure your reports meet specific industry standards and your leases align with legal requirements. These conditions include compliance with the International Accounting Standards and newer rules like GASB 87, which U.S. firms must abide by.
The Governmental Accounting Standards Board (GASB) began in 2019. It was a new law to make the financial information for governments more transparent and accurate by applying a single module for lease accounting across most states. Before, organizations would not include certain liabilities in their financial reports. However, under GASB 87, firms report all leases as capital lease/financing leases, pushing companies to make accurate reports.
With these scrutinizing boards and regulatory bodies demanding complete compliance, it can be challenging for companies to adhere. However, using leasing software to adapt to these new standards can be helpful. It can manage leases under accounting bodies your business follows and ensure accurate financial reporting. You can use leasing GASB 87 software if your company wants its information to meet the needs of The Governmental Accounting Standards Board by improving your accounting and financial reports. It helps you track leases and maintain an audit trail that can get you compliant with numerous boards other than GASB 87, including ASC 842 and IFRS 16, within hours. Furthermore, this software can also provide the following benefits:
2. Integrated Software Programs
Managing a leasing company can be extremely difficult if you’re using outdated leasing software. Having to use multiple non-integrated programs for lease management is a headache. You have to juggle between various software programs to manage every aspect of leasing, like accounting, front office, and document management. However, this obsolete method is time-consuming, costly, and requires a lot more effort.
Upgrade to a newer leasing management software for more efficient and consistent data collection. It has integrated programs that help you manage every aspect of leasing management, all from one system. It eliminates the frustration of constantly switching between multiple platforms. This convenience enables you to manage everything from lease accounting to budgeting, streamlining your work process and reducing labor costs.
3. Automates Workflow
Traditionally, you would open a Word document or make an Excel sheet to create a ledger of payments. However, this outdated method is ineffective, time-consuming, and costly. Manually having to complete leasing administrative tasks requires extra time and effort. For example, the various steps you have to take to rent out property is a hassle. First, you have manually scoped out vacancies and market your properties to potential tenants. Then, you might have to set tour dates and finally have them fill out paperwork. Why drag this process on for weeks when you can do it much quicker through leasing software?
Juggling the maintenance calls, paperwork, late payments, and deadlines for each stakeholder can be highly challenging. However, you can streamline your management process by automating these redundant tasks using leasing software. It has many benefits for you and your company, which include the following:
- Removes the need for filling out paper.
- Secure online storage of records and data.
- Automatically adds late fees into the ledger.
- Reduces time and effort to compile data manually.
- It manages a diverse portfolio in a single system.
- Improves data accuracy by removing human errors.
Automating your workflow can make leasing management a hassle-free job. It can reduce boring and repetitive tasks by 60% to 95% and help your company save 77% of its time. When time is money, automating can help your finance department save around $878,000.
4. Cloud-based Collaboration Between Departments
Some lease accounting systems are cloud-based, which allows interdepartmental collaboration by allowing multiple users to access and use data simultaneously. It is a safe and secure method to improve cooperation between departments, which can enhance the effectiveness of your employees by 50%. When everyone works together, they are also 64% likelier to focus on their tasks than those who work alone.
This teamwork is only possible due to leasing software that centralizes the firm’s data in one place. With multiple departments focusing on different aspects of lease management, a cloud system can give them a shared space to work together. They can receive real-time notifications and updates, experience collaborative workflows, and securely share documents. For example, the legal department can handle the contracts, and the finance department can handle the payments without the delay of waiting for updates. It eliminates time-consuming processes like waiting for emails and revisions. Instead, leasing software creates a streamlined system that maximizes your company’s productivity.
5. Improves Relationships with Vendors
As your company grows, so does the amount of vendors and contracts. However, keeping track of all of your stakeholders can take time and effort. You can miss updates, complaints, and deadlines, making them feel neglected. Ensure a good and stable relationship with your vendors by using leasing software, which can provide the following benefits:
- Provide a complete schedule of contract deadlines and critical dates.
- It enables you to utilize communication tools for timely contact.
- Use insight reports and analytics to gain insight into vendor needs.
- Automated payments, which ensure punctuality and create a positive relationship.
- Leasing software provides auditory transparency and increases confidence in potential contracts.
With leasing software, you not only enhance your efficiency, but it also builds a positive reputation for your firm. With prompt communication and payments, you can build a strong relationship with vendors.
Choosing an excellent leasing software depends on how much it benefits your company. Instead of going after services offering many modules, consider the software your employees can adapt to the fastest. Besides streamlining your workflow and making leasing easier, upgrading to modern leasing apps can help you expand your firm. It enables you to take on more and more leases and increases your profit by reducing opportunity costs. Leasing software has paved the way for the future of management, so why wait to get all these benefits?