Timeshare, Healthcare Part of AICPA’s Latest Working Drafts on Revenue Recognition

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The American Institute of CPAs (AICPA) Financial Reporting Executive Committee has released another round of working drafts of revenue recognition implementation issues. This batch targets four industries: timeshare, health care, nonprofits and telecommunications.

The AICPA formed 16 industry task forces to help develop a revenue recognition accounting guide that will provide examples on how to apply the new revenue recognition standard. In 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2014-09, Revenue from Contracts with Customers (Topic 606) that will remove the transaction- and industry-specific revenue recognition guidance under current U.S. GAAP. The guidance will be replaced with a principle-based approach for determining revenue recognition.

The latest drafts include the following:

Time share

Issue No. 16-8: Allocating the Transaction Price and Transfer of Control

Expected Overall Level of Impact to Industry Accounting: Significant

Issue No. 16-10: Contract Costs

Expected Overall Level of Impact to Industry Accounting: Minimal

Health care entities

Issue No. 8-10: Performance obligations

Expected Overall Level of Impact to Industry Accounting: Moderate

Nonprofit

Issue No. 11-5: Not-for-Profit Subscriptions and Membership Dues

Expected Overall Level of Impact to Industry Accounting: Moderate

Telecommunications

Issue No. 15-6: Impact of enforceable rights and obligations on contract term

Expected Overall Level of Impact to Industry Accounting: Minimal

Comments are due Feb. 1 to the addresses at the bottom of the drafts.

About Terry Sheridan

Terry Sheridan

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.

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