For businesses operating across borders, especially between the US and UK, lease accounting is more than just paperwork—it’s a compliance minefield. One restaurant group learned this the hard way when they mixed up the rules under ASC 842 (US GAAP) and FRS 102 (UK GAAP). The result? Misstated liabilities, investor distrust, and the risk of penalties that could have cost them millions.

Here’s how the wrong accounting standard nearly derailed their expansion—and how they corrected course.

Don’t Let Lease Accounting Confusion Cost You Millions

The Problem: Confusing Lease Standards Across Jurisdictions

With operations in both the US and UK, the restaurant group struggled to keep lease accounting straight. Some locations were reporting leases under outdated policies, while others skipped critical disclosures entirely. The lack of a unified approach meant inconsistent reporting, inaccurate balance sheets, and potential compliance failures.

The Solution: Align Accounting Practices with Local Standards

The group needed clarity. We helped them distinguish between ASC 842—applicable in the US—and FRS 102—the UK’s lease accounting framework. By tailoring accounting practices to each region’s requirements, they were able to ensure leases were correctly recorded, liabilities fully disclosed, and reporting standards consistently applied.

The Challenge: Hidden Liabilities and Investor Distrust

The confusion didn’t just create bookkeeping headaches—it led to serious financial missteps. Hidden lease liabilities distorted the firm’s cash flow forecasts and balance sheets. Lenders and investors raised red flags, uncertain about the business’s true financial health.

The Action: Comprehensive Lease Review and Restatement

We conducted a detailed review of all lease agreements, recalculated liabilities according to the appropriate accounting standards, and helped implement accurate reporting frameworks. With corrected disclosures and transparent financial statements, the restaurant group rebuilt credibility and restored investor confidence.

The Result: Accurate Reporting and Better Financing Options

After aligning lease accounting with ASC 842 and FRS 102, the group eliminated compliance gaps, avoided potential penalties, and improved their access to financing. What could have been a disaster turned into a strategic advantage—empowering growth and fostering trust.

Accounting Confusion – Are You Applying Lease Accounting Correctly Across Borders?

✅ Identify which lease accounting standard applies in each country you operate in
✅ Ensure liabilities and disclosures are reported accurately and consistently
✅ Avoid costly restatements, audits, and investor pushback
✅ Strengthen trust with investors, lenders, and partners

Don’t let lease accounting confusion slow your cross-border expansion. DM us ‘LEASE’ for a free review of your lease reporting framework in the US, UK, or both.