Accounting for shrinking real estate footprints : Applying lease termination, abandonment and impairment accounting rules in the real world

This paper discusses the common accounting treatment most often observed in practice when real estate footprints need to be reduced. The goal is to explain and illustrate through examples the most frequently used accounting terms and show the financial statement outcome in a format designed for real estate professionals. This paper is not an all-inclusive accounting guide. It does provide information that real estate professionals can use to perform initial assessments of real estate’s impact on financial statements and prepare for conversations with their accounting counterparts. Real estate professionals may also use the information presented here to craft suggestions to improve financial statement presentation.