[CAFR-Contacts-News] Implementation of GASB 87, Leases

[CHASE Stacey A * DAS]

Good afternoon CAFR contacts!

While many of you are working diligently to implement GASB Statement 84, Fiduciary Activities, I want to take a moment to highlight the next implementation opportunity waiting just around the bend...GASB Statement 87, Leases<https://gasb.org/jsp/GASB/Document_C/DocumentPage?cid=1176169170145&acceptedDisclaimer=true>. GASB 87 doesn't go into effect until fiscal year 2021; however, we expect agencies will need ample time to conduct preliminary research in order to implement the statement beginning 7/1/20. It is our understanding that Secretary of State auditors will be reaching out to agencies this Spring to discuss GASB 87 implementation efforts.

In preparation for GASB 87 implementation, agencies should focus on identifying which contracts and/or agreements meet the definition of a "lease" under GASB 87 and collect the applicable data elements referenced in the GASB 87 Lease Data Matrix available on the SARS training and resources webpage<https://www.oregon.gov/das/Financial/Acctng/Pages/Training.aspx>.

Please note: this is more than just identifying "known leases" (e.g. facilities, copier); rather, agencies will need to evaluate their contracts and/or agreements to determine if they 1) meet the definition of a "lease" or 2) contain a "lease component" embedded in the contract and/or agreement. Please engage with your agency's Procurement and/or Facilities team to determine which contracts and/or agreements are subject to GASB 87 reporting.

Understanding that many of the "known leases" are related to copiers, DAS Procurement Services has been coordinating directly with Ricoh to identify state price agreement copier leases subject to the new reporting requirements that were in effect as of 12/31/19. DAS Procurement Services will distribute the data received from Ricoh to agencies. Agencies will be responsible for identifying and collecting data for all GASB 87 subject state price agreement copier leases signed on or after 01/01/20 and all non-state price agreement copier leases.

Attached is a timeline developed to assist agencies in coordinating GASB 87 implementation. We recommend agencies use this tool as a baseline to develop agency-specific implementation plans. An overview of GASB 87 was provided during the 2019 SARS Year-end Close Training; the recorded training and slide deck are available on the SARS training and resources webpage<https://www.oregon.gov/das/Financial/Acctng/Pages/Training.aspx>.

SARS is currently working with SFMS to update the chart of accounts in SFMA and to establish new transaction codes. The new accounts and transaction codes are intended to be available in SFMA by 7/1/20. GASB 87 related training will be provided to agencies in late Spring (date TBD) and the plan is to update the OAM by Summer.

Implementing this statement may be a heavy lift for agencies...don't delay, start today! :)
s

Stacey A. Chase
Senior Financial Reporting & Policy Analyst
Chief Financial Office
Department of Administrative Services
Phone: (503) 947-8567
https://www.oregon.gov/das/financial/acctng/pages/index.aspx

Data Classification: Level 1 - Published

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