Leases & Your Balance Sheet
Choosing a lighting vendor under the newly-issued lease accounting standards
Does this affect my company?
If your company is subject to IFRS Standards (including US GAAP guidance), then yes.
What are these changes?
IFRS 16 (and US GAAP Lease accounting standard - ASC 842) now requires all companies to recognize long-term leases as right-of-use assets along with commensurate lease liabilities on their balance sheets. It’s estimated that over $2 trillion of lease-related liabilities will be added to the S&P 500 financial statements.
If your balance sheet shows a substantial increase in debt from the long-term leases you will now need to recognize, the last thing you want is to add to your debt load by leasing your lighting. Highly-leveraged companies will have trouble accessing additional credit through their bank or equipment suppliers.
CHOOSING A LIGHTING VENDOR
There’s no need to expose your company to financial risk in order to upgrade your lighting. The financing model of UrbanVolt Light as a Service™ was designed as a cash-positive solution to fully protect your production capacity and profitability.
At this time, only Urbanvolt offers an off balance sheet service that does not fall under the requirements of the newly issued lease accounting standards.
Even if your balance sheet is minimally affected by these changes, we ask you simply: Why add to your liability when a better way exists?
How does UrbanVolt Light as a Service™ work?
With UrbanVolt’s unique LaaS™ model, you get light by subscription. No money down, no financial risk, no project or maintenance headaches, and CFOs love that our service offering is off balance sheet.
We project-manage the delivery and installation of your new LED lights.
Enjoy improved light levels with all maintenance covered by your subscription.
In the words of our clients:
Cargotec is a truly global company, employing 11,000 people in 45 countries. They enable smarter cargo flow with their leading cargo handling solutions and services.
Cargotec partnered with UrbanVolt to transform their manufacturing plant using Light as a Service.