This article examines the best rental accounting software for compliance that organizations should be looking for in 2022
Despite all the choice there is in space, not everything may be right for your business.
The use of lease accounting solutions is essential to meet the compliance requirements of ASC 842, IFRS 16 and GASB 87.
It also pays to streamline lease accounting operations and audits, standardize processes, improve accuracy, and ensure timeliness, among other things.
Without using reliable rental accounting software, your workflows can easily collapse and potentially destroy the productivity and reliability of your business.
However, not all rental accounting solutions are designed the same. Many vendors claim to be the best, but fail to meet your software expectations and help you meet your business goals.
If you’re looking for highly effective rental accounting solutions, check out four top choices for your business to explore:
Trullion is a hyper-efficient SaaS powered by artificial intelligence (AI). It streamlines your full compliance with ASC 842, IFRS 16 and GASB 87. The software is ideal for businesses, audit and CPA firms, and accounting teams managing more than 10 leases.
Trullion offers a unified and intuitive platform with robust features to improve the transparency, collaboration and financial visibility of your business.
One of those features is automated, AI-powered contract mining.
Trullion’s machine learning and optical character recognition (OCR) capabilities can extract relevant information from your downloaded contracts. They can then propose data entries according to accounting standards.
Trullion also streamlines your compliance by automating compliant rental accounting workflows into user-friendly journal entry reports, disclosures, and more. Even when exported, these documents remain connected to their data sources (eg original contracts) which auditors can access immediately with a single click.
Trullion has several other cool features like:
- Downstream reports
- Asset lifecycle management
- Amortization schedule
- Capitalization reporting
- Budgeting and forecasting
- Critical date alerts
- Track payments, and more.
In particular, corporate and financial controllers, accountants and other business users appreciated the convenience offered by Trullion’s audit trail. They even praised the smart features that mine data and support multiple markup authorization tasks.
However, users have also reported that if your lease has many variables, it may take a long time to process. Nevertheless, they always claimed that they did not encounter any software bugs and that the automatic extraction of contract data was 95% accurate.
With Trullion, you and your auditors get a 360-degree view of your audit trail and a single source of truth for your financial reports.
You can also centralize and simplify your lease accounting and auditing processes, resulting in exceptional efficiency and business performance.
2. Administration of the Nakisa leases
Nakisa’s lease management software is an enterprise cloud platform compliant with IFRS 16, GASB 87 and ASC 842. It integrates with enterprise resource planning (ERP) tools and is available in all currencies and in eight languages. Nakisa is best suited for business, including real estate companies.
Nakisa’s flexible and end-to-end solution offers these features:
- Perform initial assessments of lease debts and right-of-use assets
- Standardize the identification and classification of leases
- Bulk download and edit contracts
- Scheduler for automated postings and batch processing, etc.
Nakisa’s lease accounting software is also scalable to business demands and simplifies compliance with international lease management standards.
It has native APIs and integration technologies to help you connect to ERP tools like Workday and Oracle.
Nakisa even provides actionable insights through ad hoc reports and analysis, and reconciliation reports for the audit trail, among others. This translates to automated reporting, minimal irrelevant rental costs, and more.
Customers appreciate the ease of setup and use of Nakisa and the fact that your data remains secure and accessible in the cloud. This attribute prevents you from sifting through thousands of files to get the correct entries in accordance with IFRS 16. It also optimizes your time for other business tasks, making you efficient.
On the other hand, customers encountered many bugs (even with their updated versions) and technical inconsistencies that took too long for their IT departments to resolve.
3. Zen treasury
ZenTreasury’s lease accounting software simplifies your IFRS 16 compliance with automated workflows and a comprehensive set of features:
- A smooth audit trail that tracks all transaction updates throughout their lifecycle by user buffer, date and time
- Expiring lease notifications sent to your email inboxes
- Segregation of Duties acting as cash flow controls that minimize the risk of fraud and error, allowing you to delegate tasks to meet your business needs
- Integrated business register to define your business hierarchy and add relevant information about your documents, currency, limits, etc.
- Simple rental payment schedule generator
- Built-in multi-currency support for all transactions
- Manual provision and import of marketplace content, plus integration with other data providers such as Bloomberg and Reuters
ZenTreasury allows you to manage all leases and leases treated as liabilities and rights of use under IFRS 16. It also allows you to organize duration, scope and price adjustments in the same view , among others.
ZenTreasury has even validated IFRS 16 calculations such as:
- Different monthly and quarterly payment intervals
- Valuation of assets and liabilities on initial recognition and correctly calculated annual accounts
- Depreciation, etc.
Customers have found ZenTreasury’s lease accounting software agile and easy to use at all levels of the organization. They claim that the customer service is commendable and generally offers great value for the money. However, having the ability to freeze all leases has a downside if you want to freeze only data from previous periods – and not all or future periods.
Appfolio is a comprehensive property management software, ideal for commercial, residential, and mixed-portfolio property managers with growing complex businesses, among others.
A cloud-based solution, Appfolio has AI-based invoice entry features that analyze supplier invoices and automate your accounts payable and payment processing.
Appfolio even offers strong financial reporting features with templates for different types of portfolios. To access data and information, you can get over 80 customizable reports, for example, balance sheets, cash flow statements, rental listings, and more.
Appfolio also supports your decision-making processes with real-time data visualization and customizable performance analysis dashboards.
Appfolio offers several other integrative features for the holistic management of real estate lease accounting. These include:
- Accounting and reports: monitoring and reconciliation of the maintenance of common areas (CAM), online payments, group charges for tenants, etc.
- Communication and Service: Online portals for tenants, landlords, sellers, board members and others. In addition, communication by SMS and e-mail, shared folders, etc.
Marketing, maintenance, staffing, training, hiring and management features are also available.
Additionally, users liked how Appfolio increased the efficiency of their staff and processes. They say the platform is simple and still accessible since it is in the cloud. Appfolio has pretty much everything you need for a real estate business.
Unfortunately, many customers also complained about the lack of user-friendliness of workflows and the inability to support specific portfolios. This amounts to a disadvantage and a huge margin of error.
Users even say that Appfolio’s terrible customer support gives unsatisfactory value for your investment. They also didn’t like the lack of open APIs, which makes integrations with third-party tools impossible.
Make the right choice in your rental accounting solution
There is a lot of lease accounting software available on the Internet, but not all of them are right for your business. Choose those whose features functionally meet your business requirements, are always compliant, easy to install, use and onboard, deliver exceptional customer service, and more. The best lease accounting solution will also give maximum value to your investment and genuinely care about growing your business. Start exploring these and other solutions and use them to scale your business.