It’s July 2022 which means that the Financial Accounting Standards Board’s Accounting Standards Codification 842, also known as ASC 842, has officially come into play for US private companies. ASC 842 changes the way companies account and report their lease obligations whether they are a lessee or lessor. It brings all leases onto private company balance sheets by creating right of use (ROU) assets and liabilities. This means, operating leases will now be on the balance sheet, and capital leases become finance leases. The main takeaway from this standard coming into effect is understanding the impact on regular operations.

What should companies do if they haven’t implemented ASC 842 yet?

The first step is understanding all your leases. A fleet of vehicles, heavy equipment, global offices with a different lease for each copier – it all adds up. And it’s not just about the initial adoption of the new standard; it’s also about the ongoing process of maintaining compliance. The accounting department needs to have a seat at the table and be in the know when it comes to negotiations and executions to avoid being behind amortizing leases. It’s also important to have a clear idea as to what constitutes a lease. Some contracts for IT data management, cloud services, transportation, and advertising can have lease connotations somewhere in the fine print.

The second step is recognizing the effect to financial statements that implementing lease accounting will have and ensuring that all interested parties are well informed. A 10-year office lease can be a large liability and would require the proper explanation to board members and audit committees. It is beneficial to have all your leases in one place so that your organization can analyze their impact better.

When you should you adopt a Lease Accounting Solution?

Depending on your organization, you might have a small number of leases and so you might be able to handle implementing ASC 842 on your own and perform your lease accounting using spreadsheets and adopting a “business-as-usual” stance. However, as we’ve seen over the past couple of years, spreadsheets are not agile enough to handle the pace of change that is the new “business-as-usual.” From executives to lower-level finance team members, everybody expects the information they need immediately. Legacy applications are too slow.

How much should you be spending on Lease Accounting?

Sadly, there isn’t one specific answer. There are too many variables across industries. It’s not just about monetary cost; there is the time and effort to manage leases on your financial sheets monthly and annually. Use the following chart to estimate for your own company how much lease accounting is currently costing and where savings could be found.

We Can Help

If your current ERP doesn't have sufficient leasing capabilities, we can help you migrate to a much more robust lease accounting solution, like Black Owl Systems. If you are interested in learning more, please contact us.

A fair amount of today’s IT spend goes towards maintaining the software solutions of yesterday. Total cost of ownership (TCO) is a significant factor when considering your platform choice.

• Does the platform beneath your winery system support or hinder your business initiatives and change requirements?
• How much is your current winery system costing you?
• Can you change at pace to meet your business needs?
• What is the true cost to your business of not having platform flexibility?

Why should a winery keep their platform in mind?

With demands for quick turnaround on necessary business changes, your ability to adopt flexibility can significantly impact your success. When your technology isn’t up to speed, you’re constraining your business in a time where maintaining the status quo isn’t going to cut it.

Traditional application suites are proving to be a burden on businesses and come with a variety of challenges. Customizations to these technologies have been a hindrance to implement and an expense to own. They come with not only a monetary cost but the effort to maintain and respond to demands. A SaaS winery solution can change, adapt, and mitigate security risks. The costs of enterprise grade security are built into the solution, further reducing your business costs.

The ideal solution is one that offers an unprecedented level of enterprise grade winery functionality and technologies that extend and enhance the information available to your business users.

WineTrax is a solution designed and built by a winemaker. NuVerge had their own in-house winemaker, working with their product development team and building out wine industry specific applications, functionality, reports, and integrations with the winemaker’s needs in mind. This mindset was brought to every aspect of the WineTrax design and build.

Learn More About WineTrax

Source: I Run a Winery: Why Does the Platform Matter by NuVerge, September 27, 2021

For those who might need a refresher, technical debt is a measure of a company’s burden that stems from aging and inflexible computer systems, and it can be just as much of a liability as financial debt. When exploring the topic, there are three main questions to ask;

• What’s the annual cost?
• Is the technical debt growing or shrinking?
• What will it take to substantially reduce it?

The Technical Debt Equation

Konrad Rogers, the Chief Information and Operating Officer at Nextworld, explains that most technical debt can be traced to a single source in an organization; the Enterprise Resource Planning (ERP) software. But how does this all happen? How does it build?

At first, when exploring an ERP for your company, it seems smarter to pick the fastest solution, not the one that preserves long-term resilience. There are investments in shadow IT initiatives, and you deploy technology that goes outside of the central technology organization. The complexity of the technological infrastructure increases, the data is fragmented, future upgrades become more expensive. Maintenance is a heavy-hitter and devours IT resources, making it difficult to develop new products and capabilities. The system becomes inflexible and unreliable.

The above situation can go on for years. Think about your own system, how long it has been in place, how many hands have dealt with it over the years. There were times of innovation in the past but with the way technology is in today’s world, the traditional way no longer benefits the same way that it used to. You need to pay off the principal of your technical debt so you can devote your resources to modernization. Per Rogers, the most powerful way to reduce technical debt and acknowledge the burden of your aging technology is to eliminate the legacy ERP system.

Switching to a modern cloud-based ERP can radically reduce the complexity of your organization’s technology infrastructure. Cloud solutions are designed for integration that increase speed, data accuracy, and flexibility.

“The best cloud software today is designed with a humility that accepts that no single solution can do everything. Rather, it’s built to work with multiple programs while keeping a single up-to-date version of critical data. Equally important, it empowers rather than inhibits innovation by business units.”

Making the move to Cloud is dependent on a variety of factors and it might not be the best fit right now however, there will come a time when you no longer have a choice. Perhaps your best strategy is to keep going on-prem with continuous innovation updates. Cloud is just infrastructure, so you don't need to move your whole instance. Maybe it's a good time to pick and choose what you want in the Cloud, like security, to test it out. Moving away from traditional ERP makes the most sense.

In the end, the opportunity to tackle technical debt must fit your overall strategy. If you’re not too sure what that strategy could look like, we would be happy to share more about our own story or what others are doing.

If you’d like to read Konrad Rogers’ full blog, you can do so here.

iSP3 Solution Providers Inc. Selected as a Reseller for CAM Performance Plus
Partnership to Enhance Enterprise Asset Management (EAM) for JD Edwards Software

Vancouver, BC, Canada: iSP3 Solution Providers Inc announced today that they have been selected as the exclusive Canadian partner and reseller for the most comprehensive enhancement suite for JD Edwards ERP, CAM Performance Plus by Asset Management Solutions.

With this strategic partnership iSP3 will be providing our resource based and asset intensive customers with the ability to streamline their maintenance activities and design best in class maintenance programs. This comprehensive solution delivers rich new capabilities and improves the user experience for everything maintenance, and more. This includes a simpler and more intuitive work order lifecycle, enhanced PM’s, workforce scheduling, Google like search capabilities for your Item Master, attachment printing for work order packages, mobile applications and much more.

This Oracle Validated Integration solution has been designed in the native JD Edwards toolset for a seamless user experience, without the need for costly integration. Our implementation approach is designed to phase this modular solution into your organization to deliver immediate value, in the shortest amount of time.

“This suite of EAM solutions for EnterpriseOne will improve maintenance efficiency, asset uptime and performance for our asset intensive customers,” said William Liu, Senior Partner. “Effective maintenance management is a real home run for customers in the Energy, Lumber, Construction and Mining industries as well as public sectors with extensive lists of assets. Most importantly, this solution delivers measurable value to our customers, and our value consultants can help our customers build a compelling business case. We have chosen this solution because of the careful attention to details that will bring the greatest operational efficiencies for our clients.”

About iSP3 Solution Providers Inc
With over 20 years in the ERP industry, iSP3 delivers quality consulting services and solutions to the JD Edwards EnterpriseOne, World and Cloud customer base. We are an Oracle award winning partner with deep expertise and Oracle certifications in all JDE Core Applications as well as Technical CNC and Oracle Cloud Infrastructure. Whether you require assistance with implementations, upgrades, migrations, or technical and functional services, our team’s deep knowledge and experience in asset intensive industries and ERP are here for you.

About Asset Management Solutions (AMS)
Asset Management Solutions (AMS) was founded with a primary focus in utilizing technology to provide comprehensive JD Edwards asset and maintenance management solutions to our clients. AMS serves a wide variety of industries, including refineries, mining, construction, utility, energy, manufacturing, agricultural, and pulp and paper.

Learn more about CAM Performance Plus

Contact:
William Liu
Senior Partner, iSP3 Solution Providers Inc.
wliu@isp3.ca | www.isp3.ca

iSP3 was joined by Greg Kautz (CPA, CMA) and Derek Kautz (CPA) Co-Founders of Black Owl Systems to discuss the importance of modernizing your lease accounting systems. The following video highlights from the presentation focus on how modern lease accounting solutions can assist and bring value to organizations as well as looked at today's main challenges.

Modernizing Lease Accounting

How can modern lease accounting solutions assist and bring value to organizations?

Lease Accounting Challenges

Why has accounting become so much more complicated, in particular lease accounting?

If you’d like to explore this topic further via an extended demo of the Black Owl Lease Accounting solution, please contact us.

iSP3 Global Technologies Selected as Canadian Partner for NuTrax for Wine™ by NuVerge
A Forward-Thinking No-Code SaaS Solution Simplifying Systems for the Wine Industry

*2023 Update To News Article: The NuTrax™ for Wine product is now referred to as WineTrax™

Vancouver, BC, Canada (January 20, 2022): iSP3 Global Technologies Inc announced today that they have been selected as a Canadian licensed reseller and partner for NuTrax™ for Wine by NuVerge. An innovative no-code solution that promotes grape to glass functionality and allows wineries to integrate automated processes with ease.

NuTrax™ for Wine is built on next generation SaaS + PaaS application technologies with accelerators and pre-configurations that jump start your next strategic Enterprise Grade Wine & Beverage applications move. Fully integrated to your procurement processes and financials, the solution utilizes a common data model underpinning all business application functionality from the management of growers and blocks, through blending operations, inventory, distribution channels and supply chain.

“This partnership offers a great opportunity for the many wineries in British Columbia,” said William Liu, Senior Partner, iSP3. “We appreciate that the NuVerge Product Development team used their decades of wine industry experience and wine making knowledge to build and deliver this SaaS winery solution.”

Bill Hylton, NuVerge COO, mentioned, “We are very pleased to collaborate with iSP3 and extend our NuTrax for Wine Solution to British Columbia. Our No-Code Wine Solution is the first within the winery industry! Our Solution allows Wineries to automate specific wine processes with speed and simplicity; allowing wineries to digitally transform and make their operations more efficient, and competitive for decades.”

About iSP3 Global Technologies Inc
iSP3 Global Technologies Inc is a division of iSP3 solution providers inc, headquartered in Vancouver, Canada. With over 20 years in the ERP industry, iSP3 delivers quality consulting services and solutions to the JD Edwards EnterpriseOne, World, and Cloud customer base. We are also a Global Reseller of Nextworld™ and Nextbot™ and a Solution Developer for the iAllTIME solution built on Nextworld. We now include Nextworld as a tier-one ERP solution for our clients who would benefit from a no/low-code platform to provide unprecedented agility to their business. Whether you require assistance with implementations, upgrades, migrations, or technical and functional services, our team’s knowledge and experience are here for you.

About NuVerge
Established in 2018, NuVerge is a Global Reseller of Nextworld™ ERP Applications and Nextbot™ (a No-Code platform for business process automation). NuVerge is committed to leveraging Next Generation Business Software and Technologies that focused on digital transformation and accelerated process automation. Our NuTrax for Wine™ Solution focuses on; Farming & Viticulture, Product Control, Wine & Blending, Financials & Forecasting, and Technology that allows Wineries to integrate automated processes with ease.

The NuVerge Strategy is simple; assist our clients in the untethering of legacy software while improving their organizational performance and growing their business at an unprecedented pace. NuVerge is headquartered in Longmont, Colorado and serves its North American client base from its East and West regional offices.

For more information contact wliu@isp3.ca or visit www.isp3.ca.

FOR IMMEDIATE RELEASE: October 28, 2021
William Liu
iSP3 solution providers inc.
wliu@isp3.ca

iSP3 Selected as Canadian Partner for Black Owl Systems Lease Accounting Software
Innovative Solution Based on Strong Accounting Principles for Cloud or On-Premise

Vancouver, BC, Canada: iSP3 solution providers inc. announced today that they have been selected as a Canadian partner for Black Owl Systems’ revolutionary Lease Accounting software. Black Owl Systems is delivering a new approach to lease accounting software which is founded on strong accounting principles and can be utilized with the modern technology of cloud or on-premise.

Typical lease accounting can be quite complex and increase the time and effort required to ensure calculations and disclosures are correct. Black Owl Systems is setting a new benchmark in lease accounting with an easy to use yet comprehensive and complete solution ensuring you can easily manage your leases to be IFRS and US GAAP compliant. This is a far more robust system than other lease accounting solutions as it delivers many benefits that are designed to directly reduce burden of managing leases and increase ROI for companies.

“This partnership will bring great benefit to all of our customers who lease physical assets, no matter what ERP they run,” said William Liu, Senior Partner at iSP3. “As we've seen, the regulations for lessee and lessor accounting are intricate and using manual spreadsheets to create schedules and journal entries overlook many of these important calculations. Black Owl Systems has designed a solution to reduce the risk of incorrect accounting, ensure compliance for reporting in IFRS 16 and ASC 842, as well as a host of other benefits. We look forward to the opportunities that this solution will bring to our customers.”

About iSP3
With over 20 years in the ERP industry, iSP3 solution providers inc. delivers quality consulting services and solutions to the JD Edwards EnterpriseOne, World, and Cloud customer base. We now include Nextworld as a tier-one ERP solution for our clients who would benefit from a no/low-code platform to provide unprecedented agility to their business. Whether you require assistance with implementations, upgrades, migrations, or technical and functional services, our team’s knowledge and experience are here for you.

About Black Owl
Black Owl Systems Inc. is a Canadian company, developing and delivering innovative accounting solutions designed by accountants for accountants. Their system is built to comply with IFRS 16 and ASC 842 standards but follows the methodologies of standard accounting practices. Our business applications are developed in North America using modern cloud-based technologies to ensure delivery of leading global enterprise solutions.

For more information contact wliu@isp3.ca or visit https://www.isp3.ca/lease-accounting/.