BlogLease Accounting2024 Lease Accounting Software Pricing Guide

2024 Lease Accounting Software Pricing Guide

Since the adoption of the new lease accounting standard (ASC 842 / IFRS 16) in 2022, leaseholders have had to record most leases on their balance sheets, documenting their lease liabilities and corresponding right-of-use asset(s). The new standard also requires that lessees make changes to related systems and processes.

As a result, the financial reporting of leases has become far more complex—and commercial tenants have been looking to their CPAs and other outside experts for help in keeping everything straight. 

But not all CPAs are experts in ASC 842—and relying on a CPA can cost more time and money than is necessary. Even if they are trained in ASC 842, the work carries the risk of manual error. Additionally, CPAs charge $200 or more per hour for this kind of specialized work—a bit pricey considering many accountants may have to learn as they go! 

Lease accounting software, then, is essential for any commercial lessee. A good accounting software solution can streamline the process and potentially yield tens of thousands of dollars in savings—not to mention cut down on countless hours of wasted time. Don’t run up a tab with a CPA if you don’t have to!  

When it comes to choosing your lease accounting software, price matters. What’s more, prices can vary dramatically, with some companies offering one-time or annual pricing, and others offering per lease or per month pricing. 

If you’re a commercial lessee, this guide will help you get up to speed on lease accounting software prices and provide a simple, easy-to-use solution that best suits your needs.

What’s the total cost of ownership for lease accounting software?

The total cost of ownership (TCO) for a lease accounting software is the sum of all direct and indirect costs associated with the purchase and use of that software. The TCO depends on a lessee’s portfolio size, as well as the amount of time and effort a business is willing to commit to outsourcing experts.

Typically, software fees associated with the calculation of a single lease average about $10 per lease, per month for operating leases—those that do not transfer ownership rights to the lessee. 

But not all software is created equal. Costs can vary depending on software sophistication, data integrity, and the level of reporting detail users are afforded.

What factors influence price?

Pricing is largely determined by the number of leases, the type of lease (operating vs. finance lease), level of outsourced support (e.g., data abstraction, implementation support), and the quality of inputted data. 

Given that lease accounting standards are here to stay, business owners often see discounted pricing per lease when opting into longer term agreements.

Pricing ‘gotchas’ or red flags

When selecting a lease accounting software, businesses often miss the price tag associated with data abstraction. As a result, many businesses opt for less expensive solutions thinking they’ve gotten a good deal, only to end up engaging a third party vendor equipped to review and abstract lease documentation later on. 

This simple mistake can lead to higher overall costs and longer turnaround times—not to mention, the data will still need to be manually inputted into the software to calculate and produce the proper reports. If you spend most of your time implementing software instead of running your business, you’ve probably chosen the wrong software. 

Additionally, manually inputting data can lead to more problems and mistakes. As the old saying goes, garbage in garbage out—or the quality of the input will always determine the quality of the output. Leaving the tedious work to the experts, coupled with a good software solution, reduces unexpected hiccups or additional fees.

What are other factors besides cost should you consider?

Other factors you should look for besides cost include:

  • Implementation and support teams: Most CPAs are not experts in ASC 842. By using outsourced experts, you reduce time searching for answers, as well as avoid the risks of making wrong decisions.
  • User interface: You want a system that is easy to navigate so you can know exactly what to look for—and where to find it. When you are audited—which is an inevitability for most companies—your lease accounting software should make things easier. Ask yourself: do you know where to pull certain reports? Or better yet, does your auditor have access to your easy-to-use lease accounting software so you don’t have to go looking for them?
  • Opportunity cost: Again, ask yourself: what’s the TCO of not having a software solution? Manually calculating these reports is costly—both in terms of actual dollars spent, and in terms of spending time away from running your business.

What is typically included, or not included, in software solutions?

Because lease accounting software are highly specialized solutions, many products do not make it easy to access all of this newly sourced data. Extending lease data visibility beyond lease accounting can lower business risk and support revenue growth if leveraged properly.

Leasecake provides a centralized repository to stay organized, eliminate inefficiencies, and increase profitability. We’re the only full service lease accounting platform with in-house real estate and accounting experts who can provide support for data abstraction and implementation efforts all the way through integrations to general ledger software. 

While many companies offer fixed pricing, we offer simple pricing that makes our offering affordable and accessible for anyone. Just $10/location!

Our experts have decades of experience across a range of disciplines—and are all based in North America. They can help you with everything from additional clauses, lease accounting, and location management services—including ASC 842 readiness—to certificates of insurance, lease negotiation and agreement documents—and more.

Our software provides quick access to all location and lease information, with built-in notifications and reminders for all business-critical events. You can easily share information with colleagues, vendors, and clients, too. 

Whether you’re a small business or a multiple leaseholder, our solution makes managing your leases and locations easy.

Opportunity cost of CPA vs. Leasecake

For the sake of comparison, let’s look at the opportunity cost of using a CPA to help with your lease accounting needs as it relates to ASC 842 instead of our software.

Assuming, for example, you need to manage 50 leases with an implementation time of an hour per lease, and monthly reporting time of 15 minutes per lease.

A CPA, on average, would need a total of 50 hours to implement them in accordance with the new standard, and a total of 150 hours of annual year-end disclosure reporting time, for a total of 200 annual hours. At $200 per hour, that could cost lessees up to $40,000. 

With Leasecake, the total implementation time is just 5 hours, with an additional 3 hours of annual reporting time, for a total of 8 annual hours. That means our solution can save clients up to 45 hours in total implementation time; up to 147 hours in total annual reporting time; and up to 192 in total annual hours. 

For the first year, our solution can save you up to $37,500. On an ongoing basis, that means up to $30,000 in savings. For more information on our lease accounting services and software, visit this link.

Ready to learn more? Let’s connect.


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