The Overlooked Risk in Lease Management
In the rush to comply with ASC 842 and IFRS 16, many organizations focused solely on the math, getting the right numbers into the right cells. However, the most significant risk isn't in the calculation, it’s in the contractual silence. The overlooked risk in lease management is the failure to manage the living components of a legal agreement after the initial transition.
The Three Pillars of Overlooked Risk
The Critical Date Vacuum: Missing a renewal or termination window isn't just an administrative error; it's a legal obligation that can trap a company in an unfavorable site for years, directly impacting liquidity and operational agility.
The CAM Blind Spot: Most accounting software handles base rent effectively, but Common Area Maintenance (CAM) and reconciliation clauses are where capital “leaks”. Without forensic oversight, companies often overpay for taxes, insurance, and utilities that were never their contractual responsibility.
Document Fragmentation: When amendments, commencement letters, and side agreements are stored away, the Source of Truth disappears. This fragmentation leads to material misstatements during audits and significant friction during M&A due diligence.
The Forensic Advantage At Lease & Ledger Advisory, we move beyond the software. Our 7-Step Forensic Integrity Framework™ is designed to uncover these overlooked risks by interrogating the original legal manuscripts. We ensure your lease portfolio isn't just compliant, but protected against the hidden costs of contractual neglect.
