7 New Revenue Recognition Working Drafts Issued by AICPAby
The Financial Reporting Executive Committee of the American Institute of CPAs (AICPA) has released seven new revenue recognition working drafts related to the implementation of FASB Accounting Standards Update (ASU) No. 2014-09, Revenue from Contracts with Customers (Topic 606).
The working drafts concern asset management, gaming, software, and telecommunications.
“The ASU will eliminate the transaction- and industry-specific revenue recognition guidance under current US GAAP and replace it with a principle-based approach for determining revenue recognition,” the AICPA said in an announcement about the drafts. “This standard has the potential to affect every entity’s day-to-day accounting and, possibly, the way business is executed through contracts with customers.”
More information about the revenue recognition implementation issues will be posted regularly on the AICPA Revenue Recognition Resource Center page.
Comments should be submitted by Dec. 5.
With the release of these seven revenue recognition working drafts, implementation issues for 10 out of 16 industry task forces have been published for informal comment. Once finalized, the implementation issues will be compiled in a guide the AICPA is developing on the new revenue recognition accounting standard.
The task forces cover the following industries:
- Aerospace and defense
- Engineering and construction
- Investment asset management
- Oil and gas
- Power utility
The latest working drafts come under the following task forces:
- Implementation Issue No. 10-6: Recognition of Contingent Deferred Sales Charges
- Implementation Issue No. 6-4: Accounting for Base Progressive and Incremental Progressive Jackpot Amounts
- Implementation Issue No. 14-1: Determining Whether Software Intellectual Property is Distinct in Cloud Computing Arrangements
- Implementation Issue No. 14-4(A): Defining and Identifying Potential Price Concessions
- Implementation Issue No. 14-4(B): Estimating the Standalone Selling Price of Options That are Determined to be Performance Obligations
- Implementation Issue No. 14-6: Estimating the Standalone Selling Price
- Implementation Issue No. 15-12: Disclosure and Transition
Terry Sheridan is an award-winning journalist who has covered real estate, mortgage finance, health care, insurance, personal finance, and accounting and taxation issues for newspapers, magazines, and websites. A Chicago native and former South Florida resident, she now lives in New England.