ADVISORY
Japan’s new lease accounting standard
From contract collection and AI-assisted initial assessment to accounting policies, lease systems, first-year closing and continuing administration. We tailor the work to your preparation and available team.
01 / WHAT WE DO
Scope & purpose
The first challenge is often collecting contracts and deciding what to investigate. We combine ledgers, existing asset lists and questions to operational teams to identify potential leases, including those embedded in service contracts. Collection can proceed by site or contract type, with priorities based on significance and complexity.
AI-assisted investigation, with CPA review
AI assists extraction and initial assessment; a CPA checks the supporting clauses against original records and actual usage. Client contracts and business data are handled with settings that exclude them from AI model training. The environment, documents, purpose and exclusions are discussed and agreed before analysis. Changes in scope are confirmed with you.
When preparation time is short
Our accelerated plan combines early scoping, collection and analysis in parallel, and priority work on first-year policies, calculations and closing. Work can start on available contracts while further documents are collected. The timetable depends on the necessary checks, staffing and start date, and AI scope is agreed in advance.
ASBJ Accounting Standard No. 34 applies to annual and consolidated annual periods beginning on or after 1 April 2027. We confirm the framework and adoption period that apply to your company.
02 / PROCESS & HANDOFF
How the work progresses
- Plan the scope and teamScope, responsibilities and implementation timetable
- Collect contracts and establish the factsContract list, initial assessments and focused clarification questions
- Document policies and assessment criteriaPolicies, assessment records and significant issue memoranda
- Calculate the impactCalculation worksheets, schedules and estimated impact
- Select and implement a lease systemRequirements, comparisons, migration and test records, operating flow
- Prepare first-year closingOpening balance support, example entries and draft disclosures
Illustrative workflow. The scope and deliverables are agreed for each engagement.
01Plan the scope and team
Confirm entities, sites, transactions, adoption period, storage locations and staffing. Design collection, investigation scope, AI use, responsibilities and timetable around what is practical.
Output / next handoff: Scope, responsibilities and implementation timetable
02Collect contracts and establish the facts
Reconcile contracts, accounting data and operational information. AI can extract assets, terms, consideration, renewal and termination clauses and support initial assessment. Separate missing facts and actual usage information from facts already available in the documents.
Output / next handoff: Contract list, initial assessments and focused clarification questions
03Document policies and assessment criteria
A CPA checks extracted information and initial assessments against source records and transaction substance. We explain options and implications for lease identification, lease terms, short-term and low-value treatments, service components and transition. Management decides accounting policies and individual treatments.
Output / next handoff: Policies, assessment records and significant issue memoranda
04Calculate the impact
Prepare payment, term and discount rate data under the chosen policies, and estimate right-of-use assets, lease liabilities, depreciation and interest. Lessor classification and accounting can also be considered where relevant.
Output / next handoff: Calculation worksheets, schedules and estimated impact
05Select and implement a lease system
Define requirements from contract volumes, complexity, policies, interfaces, budget and operations. Compare products and spreadsheets; coordinate configuration, migration, representative contract tests, changes and staff guidance with the vendor. Clarify the division of product configuration or development and accounting support.
Output / next handoff: Requirements, comparisons, migration and test records, operating flow
06Prepare first-year closing
Review transition and opening contract data, support opening balances and entries and required presentation and disclosures, and define how trial figures become final reporting figures.
Output / next handoff: Opening balance support, example entries and draft disclosures
03 / DELIVERABLES
Deliverables & their use
- Contract inventory, assessment records and issue memoranda
- Accounting policies and calculation worksheets
- Lease register, impact calculations and first-year closing schedules
- System selection, testing, approval and update procedures
The package links figures and conclusions to source information and review records. Its precise contents are agreed for the engagement.
04 / DISCUSS YOUR NEEDS
Getting started & engagement conditions
Tell us the expected adoption year, entities and sites, contract types and approximate volumes, storage and collection status, existing registers and systems, team and target date. Specialist staff support collection, data preparation and registers. A CPA designs the scope, considers significant issues and manages quality; this may be the representative or another CPA. The team and contracting entity are stated in the proposal. Contracts are generally with ICHIYAMA ACCOUNTING OFFICE; depending on the engagement they may be with 株式会社CP ARCS.
Indicative fees and conditions ↗After implementation, new contracts and changes still need assessment. Continuing accounting advice and recurring administration are separately scoped, with register updates, monthly calculations and closing schedules available through recurring lease administration.
LET’S TALK
Let’s work out your next step.
You do not need a finalized brief. Start with the challenge or the work you would like to entrust.