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Accounting

AICPA Issues Revenue Recognition Working Drafts for Aerospace, Telecom and Time-Shares

The AICPA’s Financial Reporting Executive Committee (FinREC) has issued four new working drafts of accounting issues related to the implementation of Accounting Standards Update (ASU) No. 2014-09, Revenue from Contracts with Customers – for ...

Jan. 11, 2017

The AICPA’s Financial Reporting Executive Committee (FinREC) has issued four new working drafts of accounting issues related to the implementation of Accounting Standards Update (ASU) No. 2014-09, Revenue from Contracts with Customers – for broker-dealers and depository and lending institutions – and is soliciting feedback.

The ASU will eliminate the transaction- and industry-specific revenue recognition guidance under current U.S. GAAP and replace it with a principle based approach for determining revenue recognition.

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.

The AICPA established 16 industry task forces to help develop a new Accounting Guide on Revenue Recognition that will provide helpful hints and illustrative examples for applying the new Revenue Recognition Standard. Final revenue recognition implementation issues will be included in a Revenue Recognition Guide that the AICPA is developing.

The working drafts of accounting issues are available at:

o    Issue #1-8: Contract modifications including unpriced change orders, claims and options

 

o    Issue #15-2:Identification of Separate Performance Obligations

o    Issue #15-9: Determining the standalone selling price and allocating the transaction price

 

                      Issue #16-1: Identifying Performance Obligations in Time-Share Interval Sales Contracts

 

Interested parties are encouraged to submit their informal feedback on the implementation issues by March 1, 2017.