The Leader - November/December 2008 - (Page 34)

C REAT IN G R E A L E S T A T E VA LU E: R ESPON D STR A TEGICALLY TO FI NANCI AL RE P O RTI NG CHANG E S sheet impact. Capitalizing leases currently what shows up on the balance sheet? FASB 157. For planning purposes, companies treated as operating leases could change a ‡ Can a third party logistics provider be used need to be ready 24 months in advance of company’s debt to equity ratio, which could to get your warehouse off the balance sheet? the effective date for IFRS reporting. For then affect lender agreements. According to Additional guidance is anticipated as disexample, if the effective date for companies Doug McEachern of Deloitte and Touche, a cussions continue. is for the year ending December 31, 2012, lessee’s net income would decrease initially companies need to be ready on January 1, under a capital lease since 2011 in order to have a full interest and amortization of year comparison. the leasehold interest would What steps should be taken outweigh the lease payment for the current and potential CORENET GLOBAL MEMBERS: expense, but EBITDA would changes? increase. (He stated this during STOP thinking: What is this software called IWMS? a presentation at the Industrial Steps to mitigate risk: START learning: What is the value of IWMS for me? Asset Management Council, ‡ Work with real estate IAMC, conference, May, 2008.) managers and ﬁnance departManhattan Software, Inc., the Leading Software Provider for Computer-Aided He shared two approaches: ments to improve processes FM and Integrated Workplace Management Systems invites you to their Webinars: ‡ Financial components of evaluating affected compoTHE MANHATTAN 2009 WEBINAR SERIES: approach: Lessee capitalizes nents of a transaction so that value of rights and obligations it withstands the scrutiny of Banking on IWMS. This is a demonstration on how January 28, 2009 ﬁnancial services ﬁrms around the world are becoming under the lease, typically the regulators, ﬁnancial analysts @ 2pm EST more agile and lean as they implement IWMS and save present value of the minimum and litigators millions in operating costs. lease payment. Income state‡ Discuss the evaluation of ment would reﬂect depretransactions and assets and Lean Management Technologies for the Pharma and February 25, 2009 Biotech CREs. The life sciences sector is one of the @ 2pm EST ciation of asset and imputed the possible impact to ﬁnanmost advanced in understanding the necessity for applyinterest on the lease obligation. cial statements with senior ing lean management practices to their CRE operations ‡ Whole asset approach: management and subsequent and supporting them with new technologies. Lessee capitalizes the leased communication to shareholdNew Technologies for Real Estate Lifecycle March 25, 2009 asset’s fair value and books ers, analysts and other stakeManagement for Retail. Never has it been more @ 2pm EDT two liabilities: (a) present value holders important for the retail sector to get a handle on their real estate costs. This webinar will address how new of minimum lease payments ‡ Revisit ﬁnancial covtechnologies can do just that and more. and (b) obligation to return the enants written for US GAAP, asset (reversion.) Income stateand test the implications And as an added bonus, we have prepared extensive Financial, Pharma/Biotech and Retail Process Briefs to send to those of you who participate in the webinar. Don’t wait until next year. Sign up on ment would be similar to ﬁrst under IFRS. Armed with this www.manhattansoftware.com today!! You will then begin the new year with increased knowledge and enthusiasm for all the efﬁciencies and savings you will be able to bring to your company. approach above. information, speak to lendIASB and FASB appear to ers and major investors about be comfortable with overall changing borrowing limits. approach, but many details Fair value reporting may remain to be resolved. require lower leverage models Questions that arose at the due to market volatility IAMC conference included: ‡ Revise internal controls www.manhattansoftware.com ‡ Will this include synthetic and business processes to colBoston . London . Sydney leases? lect IFRS-friendly data ‡ Will it apply to very short ‡ Monitor property and leases and/or very small leases? Things That Should Be Done Now portfolio insurance coverage as fair values corenet.indd 1 9/25/08 3:59:44 PM ‡ What about subleasing a property to Though the timing of the combination of change another entity? On whose balance sheet will GAAP and IFRS standards and the capitalWhile large accounting ﬁrms will train the lease be shown? ization of all leases is uncertain, the manprofessional staff to provide similar guid‡ Will clients shorten leases to hold down date for fair value accounting has arrived via ance and to mitigate risk, real estate-focused 2 0 0 8 TH E LE ADE R 34 NOVEMBER / DECEMBER http://www.manhattansoftware.com http://www.manhattansoftware.com

Table of Contents Feed for the Digital Edition of The Leader - November/December 2008

The Leader - November/December 2008 Leadership Contents Message from the CEO Real Estate in the News Leveraging Business Geography My Work @ Bank of America Blending the Old with the New A Tool for Growth Creating Real Estate Value Nokia-Siemens Networks’ Peter Doran DTZ’s James Maddock Annual Economic Development Directory The Georgia Report Location Profile: Magdeburg, Germany Linking Corporate Real Estate to the Enterprise 3rd Quarter 2008 Adding Value in Challenging Times Australia and New York Shell’s Paul Huston Economic Development in the News A Look Ahead In our Next Issue Calendar of Seminars Index of Advertisers Chapter Learning: The Global Perspective

The Leader - November/December 2008

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