Automation of IFRS 16 Lease Accounting in an International Retail Network
Scope of Cooperation
System Implementation
Industry
Retail
Solutions
Key Benefits
7x faster lease accounting
Correction of underestimated historical data
Transition from quarterly to monthly reporting
Elimination of human error risk in consolidation
Full implementation completed in just 3 months
Client Overview
An international retail group operating in the fashion and home & living segments, offering apparel for the entire family as well as home furnishings. The company operates in several European countries through an extensive network of nearly 2,500 retail stores.
The Challenge
Scaling Lease Accounting
The dynamic expansion of the retail network created a significant challenge in managing an increasing number of lease agreements. Due to the diversity of local regulations, currencies, and lease-specific terms, the existing Excel-based model proved inefficient and no longer suitable for the scale of operations.
Data Fragmentation
Reports required manual consolidation of independent documents from each country.
Compliance
The need to comply with the requirements of IFRS 16.
Lack of Process Efficiency
A labor-intensive process requiring significant time and human resources.
Inaccuracy and Risk of Errors
Lack of result accuracy and a high risk of human errors during consolidation.
Implemented Solution
Dedicated ILA 16 Application
We developed a dedicated ILA 16 application based on IBM Planning Analytics, replacing the previously used Excel files.
step 1
System centralization – We established a unified accounting center in Poland with the capability to process data from external systems.
step 2
Adaptation to local requirements – Each country is accounted for in its local currency, with automatic consolidation in the group currency.
step 3
Platform customization – Full customization of the ILA 16 application using IBM Planning Analytics functionalities.
RESULTS
Process optimization and increased efficiency
The implementation of the ILA 16 system delivered significant operational and financial benefits. Discover them all.
Time savings
Tasks that previously took a week are now completed within a single day.
Improved accuracy of calculations
The system identified and corrected errors in previously underestimated data.
Increased reporting frequency
The company can now prepare monthly settlements instead of quarterly ones.
Reduced risk of errors
Guaranteed process repeatability and reduced risk of errors.
Efficient implementation
The entire project was completed within 3 months, with no operational downtime and no impact on day-to-day operations.
Each subsequent cycle requires significantly less time for review and control. Once the settlement process is completed correctly for the first time, it runs smoothly in all subsequent cycles. The time savings on the client side are substantial. Tasks that previously took a week are now completed within a single day. All of this was achieved within a 3-month implementation period.
explains Maciej Filutowicz, Team Leader
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