The FASB and IASB recently released a final converged standard on revenue recognition. Companies across all industries will use a new five-step model to recognize revenue from customer contracts.
The new standard, which replaces nearly all existing US GAAP and IFRS guidance, will require significant management judgment, in addition to changing the way many companies recognize revenue in their financial statements.
The FASB voted on April 1 to propose a deferral of the effective date of the new revenue standard by one year, but to permit entities to adopt one year earlier if they choose (i.e., the original effective date, January 1, 2017). The FASB decided, based on its outreach to various stakeholders and the forthcoming exposure drafts, which amend the new revenue standard, that a deferral is necessary to provide adequate time to effectively implement the new revenue standard. The IASB has not provided a specific timeline to make a decision regarding a potential delay in the effective date of the standard.
We provide an integrated approach to help you understand the new standard and be better prepared for the change. We take into account your unique situation, and apply our significant knowledge of the new standard to help your business from end to end.