ASC 842 Lease Accounting Readiness

ASC 842, Leases, requires lessees to recognize a right-of-use (ROU) asset and a lease liability for most leases, classified as either operating or finance. Getting there depends on a complete lease inventory, appropriate discount rates, correct measurement of the ROU asset and liability, and the disclosures the standard requires. The judgment sits in lease identification, embedded leases, discount rate selection, and remeasurement events.

• Companies adopting ASC 842 for the first time.
• Finance teams with large or dispersed lease portfolios.
• Businesses facing auditor questions on ROU assets or lease liabilities.
• Companies with embedded leases or frequent lease modifications.

• Building and validating a complete lease inventory.
• Lease identification, including embedded leases.
• Operating versus finance lease classification.
• Discount rate determination and documentation.
• Right-of-use asset and lease liability measurement.
• Disclosures and source-linked support for each balance.

Modus starts with your lease agreements and abstracts the key terms. Our AI-native tooling reads the source documents, populates the lease inventory, and drafts the ROU asset and lease liability calculations, while our technical team reviews classification, discount rates, and disclosures. Because every balance links back to the underlying lease, audit teams ask fewer questions and the work moves faster. We clarify whether we are supporting your audit or helping with readiness and implementation before we begin.

• Deep expertise in lease accounting judgments.
• Tooling that automates lease abstraction and calculations.
• Source-linked workpapers that reduce auditor requests.
• Top-firm rigor at a middle-market price.
• A turnaround measured in weeks, often around four.