Rue21 ensures lease accounting compliance
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Fast-fashion retailer Rue21 is taking an intelligent approach to managing its leasing obligations.
Privately-held Rue21 has 700 real estate leases and operates more than 1,500 assets on equipment leases. Because of its large portfolio, Rue21 realized that it would be faced with initial lease accounting compliance efforts and the task of ongoing compliance with the Financial Accounting Standards Board (FASB) new lease accounting standard.
FASB Standard ASC 842, passed in 2016, requires corporations to classify all leases and report operating leases and finance leases lasting more than 12 months on their balance sheets. U.S. private companies must comply with FASB 842 in their first fiscal year beginning after Dec. 15, 2019.
To manage FASB 842 compliance, Rue21 has chosen the Accruent Lucernex lease administration and accounting solution. The software enables companies to track their leasing obligations to assure compliance with requirements from a number of boards, including FASB, and helps in evaluating the ROI of lease investments.
“We have a high level of trust in Accruent’s expertise and their ability to deliver the software and services that we need,” said Jim Signoriello, director of real estate finance, Rue21. “For a company with hundreds of locations like Rue21, lease accounting compliance is a significant project. Accruent gives us the confidence that our systems will be set up properly and allow us to manage compliance going forward.”
Headquartered in Warrendale, Pa., Rue21 operates 697 stores in 45 states.