The 10 Questions Auditors Really Ask About Your Lease Accounting

When auditors review your lease accounting, they are rarely trying to catch you out. They are looking for evidence that your processes, data and accounting judgements are complete, consistent and well documented.

Whether you report under FRS 102, IFRS 16 or ASC 842, the same themes appear in audit after audit. Finance teams that can confidently answer these questions typically experience smoother audits, fewer adjustments and less year-end pressure.

Here are the ten questions auditors really want answered.

1. How do you know you have identified every lease?
Auditors want confidence that your lease population is complete, including property, vehicles, equipment and embedded leases hidden within service contracts.

2. How do you identify new leases and changes during the year?
Strong organisations have clear processes for capturing new leases, renewals, modifications, terminations and rent changes before reporting deadlines.

3. Can you trace every figure back to the original contract?
Every key data point should be supported by source documentation. Finance teams may use AI-assisted extraction, but auditors will still expect appropriate review and validation controls.

4. How did you determine your discount rates?
Discount rates remain one of the most scrutinised areas of lease accounting. Auditors expect a documented and consistent methodology that can be applied across similar lease portfolios.

5. Why was that lease term selected?
Extension and termination options require management judgement. Auditors will want evidence supporting why an option was considered reasonably certain, or why it was excluded.

6. How are lease modifications managed?
Changes in payments, lease terms, additional space or index-linked rent reviews can affect the accounting. Missing a modification is a common cause of audit adjustments.

7. Can you reproduce and explain the calculations?
Whether using spreadsheets or specialist lease accounting software, auditors expect calculations to be reproducible, consistent and supported by a clear audit trail.

8. How are journals and disclosures produced?
Journal entries should reconcile to the general ledger, while disclosure reports should reconcile to the underlying lease schedules. Any manual adjustments should be controlled, reviewed and documented.

9. What controls prevent errors?
Who can edit lease data? Are previous accounting periods locked? Is there a record of every change? These governance controls often receive as much attention as the accounting itself.

10. Could someone else understand your lease accounting process?
If key knowledge exists only in one person’s spreadsheet or memory, auditors may see this as an operational risk. Well-documented processes reduce both audit risk and business continuity concerns.

What Auditors Really Want

Across the different accounting standards, three themes repeatedly emerge: complete lease populations, robust documentation and consistently applied accounting policies.
Audit readiness is not created in the weeks before year-end. It comes from maintaining accurate lease data, documenting judgements when they are made and ensuring every reported figure can be traced and reproduced.

Rubli’s specialised lease accounting software helps finance teams establish controlled, transparent and audit-ready lease accounting processes from day one.

Meet the Rubli Lease Accounting Software team on stand K11 at Accountex Summit Manchester, taking place at Manchester Central on the 15 September 2026. Register for your free ticket here.

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