Update on GASB 87 regarding leased items in your department

To be in compliance with new lease reporting requirements in GASB 87, CU Boulder is keeping a centralized repository for all eligible lease, rental and lessor (we are the lender of the item) contracts. The contracts will be provided as documentation for our auditors.

• Please send your eligible contracts to greg.roers@colorado.edu for all leases in place from July 1, 2020 to the present day. Our goal is to finish collecting past data by March 31, 2022. 
• Going forward, please send a copy of any new lease/rental agreement of any value that fits the criteria below to greg.roers@colorado.edu.

Background

GASB 87 requires lease accounting for all “right to use” assets. CU is now required to record the liability or receivable from receiving or granting the right to use the asset within the contract. GASB 87 defines a lease as “a contract that conveys control of the right to use another entity’s nonfinancial asset (the underlying asset) as specified in the contract for a period of time in an exchange or exchange-like transaction.”

All leases that meet these criteria need to be included unless:

• The lease term is a year or less
• The agreement transfers ownership to CU and thereby makes it a financed purchase and not a lease
• The lease agreement is between two CU entities

Before GASB 87, CU Boulder did not have any lessor contracts, i.e. CU Boulder is leasing assets to customers. With GASB 87, we need to reevaluate if we have lessor transactions. For example, GASB 87 would require us to record a lease if a business were renting space from us in a contract that lasted over a year.

Please take a fresh look at any rental or other agreements with customers that would need to be included under GASB 87.  

Thank you for your efforts on this major accounting change for our campus!