Q-Free sets new standards for IFRS 16 Lease Accounting
Q-Free makes electronic toll and traffic management easy in 15 countries. To make IFRS 16 lease accounting just as easy, the company implemented lease accounting software.
“We have an ambitious CFO who sets high standards for the finance team. Even though IFRS 16 data doesn’t have to be continuously updated, we wanted to be ahead of the requirements.”
Spreadsheet risks and sub-optimal contract management
Jonny Hemb-Selvaag, Controller at the Norwegian stock listed company Q-Free ASA, is responsible for IFRS 16 compliance. We spoke to him about the challenges of monitoring company health, changes in his role due to digitalization, and how his responsibilities have evolved over the last year.
“Previously, we used Excel for lease accounting. This exposed us to several risks. When formulas didn’t work, we imported wrong numbers to the balance sheet. All this is now taken care of by lease accounting software. This has reduced risk and improved precision.”
He has also worked to improve overall contract management.
“Centralizing and standardizing contract management is really meaningful when you are doing business in 15 countries worldwide. Office rent, cars and office machines make up the majority of IFRS 16 leases in our company.”
Time for change – making compliance easier
“What made you change the way you managed leases?”
“When IFRS 16 was introduced a few years ago, we decided it was time to treat these leases in a uniform way across all locations. This included introducing new procedures and storing all contracts in one place – in the House of Control cloud. We quit using local file servers and e-mail accounts.”
“When you concluded you were on the lookout for a software for IFRS 16 compliance, what demands did you have?”
“There were two areas of functionality that were particularly important. The first was the currency function. Because we operate in several countries, we concluded it was key that live and historic currency rates are applied to lease calculations.
“The second area was consolidation, because we have several subsidiaries. Here, we experienced customer-driven innovation firsthand. We were invited to use and give feedback on the beta version of the consolidation functionality. The development team was fast to include our suggestions into what is now an important part of the lease accounting software.”
A smooth ride – becoming a better-performing finance team
“Can you give us some insights into how you experienced starting using the software, as well as what benefits you experience?”
“Implementing the IFRS 16 software was a smooth ride. Our customer success manager at House of Control is a straight-forward and efficient person.”
“All contracts are forwarded to the finance team. We have full control over future obligations, expiry dates, options, and so on. Most importantly, we can be confident we are always compliant with IFRS 16.”
“The time we save on IFRS 16 compliance every month and quarter contribute to improved performance and higher quality work in our finance team. Plus, House of Control’s software works very nicely alongside Microsoft Dynamics 365, which is the ERP system we use.”