Prestos Subsidiaries Presto Hospitality is based in the United States and has subsidiaries in Brazil and Australia. As a nonpublic company with a calendar year-end, Presto is required to comply with ASC 842 for its consolidated financial statements starting with the year ending 12/31/20.

1. Research the reporting framework applicable to the Brazil- and Australia-based subsidiaries. Assume they follow the same reporting framework that listed (or public) companies in their jurisdictions would apply.

2. What is the effective date for these subsidiaries to apply revised lease accounting requirements? What standard must each apply?

3. What are key areas of reconciliation that will be required to consolidate the Brazilian and Australian financial statements into the U.S. consolidated report?