10 Years in the Making: The New Revenue Recognition Standard
It’s here! The new revenue recognition standard, that is. I believe it is the most pervasive and across-the-board important topic that the Financial Accounting Standards Board and the International Accounting Standards Board could have tackled. This new standard eliminates the transaction and industry-specific guidance found in current U.S. GAAP and replaces it with a principle-based approach. Also, it applies to all public, private and not-for-profit entities. I implore you, no matter what your professional discipline, to pay attention to this new standard. And please, don’t get comfortable because the effective dates seem far off.
Are you sure the final words in the new standard are consistent with what you have been hearing to date about this project? Are you comforted in having specific revenue recognition rules replaced by a more principle-based approach? Are you confident that unwritten industry norms of accounting practice formed over decades are consistent with the new standard? In this video, AICPA Senior Technical Manager for Accounting Standards Kim Kushmerick provides an overview of the standard, in addition to highlighting key items to consider and helpful AICPA resources.
The AICPA has made it a priority to support members on implementing the new revenue recognition standard. We are preparing industry-specific considerations, as well as other tools and tips to help with implementation, and will keep members apprised of any developments. For more information and updates, visit aicpa.org/RevenueRecognition where you will find a business brief, a learning and implementation plan, an audit committee primer and additional helpful resources. Additionally, a free webcast, Understanding the New Revenue Recognition Standard, will be held on June 16 at 1 p.m. ET. The FASB final standard can be found on their website.
Dan Noll, CPA, Director, Accounting Standards, American Institute of CPAs. Dan’s primary responsibilities include working with the Financial Reporting Executive Committee in arriving at AICPA positions on financial reporting matters, and in providing external financial reporting guidance. In addition, Dan leads the AICPA’s efforts related to private company financial reporting.