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　(Head Office: Chiyoda-ku, Tokyo; CEO: Osamu Hata; hereafter "WAP") will begin offering a tool for estimating the impact of the application of the "New Lease Accounting Standard" released by the Accounting Standards Board of Japan (ASBJ) on November 6*1 at no charge. This will minimize the burden of estimating the amount of impact required of all Japanese companies as a first step to comply with the new lease accounting standard.

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HUE Asset] Impact Calculation Tool for New Lease Accounting Standards
Please apply here:

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1. 2.5 years remain until the mandatory application is expected.

　The new lease accounting standard, an exposure draft of which was disclosed in May 2023, will significantly change the accounting method for lease contracts. Some companies, such as retailers with many stores, real estate companies with master lease contracts, and shipping and air transportation companies with charter leases and aircraft leases, are expected to see their obligations increase nearly tenfold.

　In response to the announcement of these system revisions, many companies are now hurrying to confirm the "estimation of the impact of the new standards. In retroactive calculation from the timing of the mandatory application of the standard (expected in April 2026), it is said that it is essential to collect information on contracts held by the company by March 2024 and calculate the extent of the impact on the financial statements.
　On the other hand, the estimation of the impact requires the calculation of amortization and discounted present value using the interest method, which requires a certain level of expertise in lease accounting. Therefore, companies that have not accounted for leases up to now have voiced their concerns, and WAP has received many inquiries from its clients.

2) Providing a highly reliable tool for estimating the impact in an Excel format that accounting departments are familiar with

　Based on the new lease accounting standards (draft), WAP will begin providing a tool free of charge to estimate the impact of converting contracts that are currently off-balance sheet to on-balance sheet. This tool is based on WAP's know-how, which has been providing lease management functions in "HUE Asset" for more than 15 years, and allows users to obtain highly reliable calculation results with a minimum of input in Excel.
　The tool calculates amortization and interest for up to 10 years and outputs the impact on the balance sheet (BS) and income statement (PL), simply by requiring the user to enter the minimum information related to the contract, such as rent and contract term. The Excel format is familiar to many accounting and finance departments, making it easy to input information and to quickly copy files to create multiple estimation patterns. Uploading to Microsoft 365, Google Spreadsheets, or any other spreadsheet that can be edited collaboratively, allows for smooth collection of contract information from each location.

　Even if a company is not using the WAP solution, it can use the impact calculation tool free of charge if it is considering compliance with the new lease accounting standards. This will minimize the time and effort required to estimate the impact amount*1.

*1: Individual addresses and applications from other companies in the same industry are not accepted.

About HUE Asset

　HUE Asset" is a domestic fixed asset management system provided by WAP that can handle the complex operations of major companies. It provides all-in-one support for fixed assets, leases, construction in progress, inventory, impairment accounting, and other operations, covering all the functions required by major companies. The service can be adapted to changes in laws and systems that are common in Japanese fixed asset operations with only a standard maintenance fee. We have already decided to provide product support for the new lease accounting standards as well, and to start offering the product in FY2024*2.

HUE Asset, a fixed asset management system for major companies

*2: Please refer to the release dated May 26 for information on support for the new lease accounting standards.
Fixed asset management system "HUE Asset" to be compatible with the new lease accounting standard
-Based on the experience with IFRS 16, the system is expected to be available by the end of FY2024.

About Works Applications

Works Applications was founded in 1996 as an ERP package vendor in Japan. With innovative solutions such as no-customization and free version upgrades, we have supported the growth of our customers, mainly major Japanese companies. Believing in the potential of each individual, we aim to be a "growth engine" that maximizes the value of companies and individuals, and we will continue our pursuit of turning "work" into "creation" and making "work" fun.

*Company names, product names and service names are trademarks or registered trademarks of their respective companies.
*The information in this release is current as of the date of publication, and is subject to change or withdrawal without notice. Please be aware that the forecasts and other forward-looking information in this release are based on uncertainties and may differ from actual results.