COVID-19: Revenue collectibility questions, answered

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04/08/20

To help navigate uncertain times, hear PwC partners discuss revenue collectibility considerations as companies look ahead to their March 31 reporting.
 

If you’re unsure about how COVID-19 might impact your financial reporting, you're not alone. In response to the COVID-19 crisis, this podcast is the next episode in a series that will address questions received surrounding the impacts to financial statements. Heather Horn is joined by PwC partners Pat Durbin and Angela Fergason to discuss the interaction of collectibility with the revenue standard. 

Topics include:

  • 0:53 - Overview. We begin by reminding listeners how the assessment of collectibility affects revenue recognition and how current events may impact the model.
  • 4:46 - Concessions and extended payment terms. In the current environment, companies may provide price concessions and extended payment terms. Angela and Pat discuss these goodwill gestures and how they impact a company's accounting. 
  • 8:48 - Reassessing collectibility. Collectibility is an ongoing assessment. We explain the importance of assessing changes in facts and circumstances.
  • 12:42 - When collection is not probable. When collection is no longer probable, what should companies be thinking about? Here we help listeners understand the model.
  • 16:10 - Interaction with CECL. With many companies adopting CECL this quarter, Angela and Pat close by looking at the interplay between what we’ve discussed and the impairment of trade receivables under the CECL model.

Recognizing revenue for customers in financial distress

View or download our flowchart.

About our guests

As the leader of the revenue and liabilities division in PwC’s National Office, Pat Durbin leads a team of partners and directors responsible for consulting with our clients and engagement teams on complex accounting matters relating to revenue, compensation, income taxes, inventory and several other topics under both US GAAP and IFRS.

Angela Fergason is a partner in PwC's National Office with 20 years of experience specializing in accounting for revenue and employee compensation arrangements. She is  a frequent speaker on accounting and financial reporting topics and is a contributor to many PwC National Office publications, including our accounting guides on Revenue and Stock-based compensation.

About our host

Heather Horn is PwC's National office thought leader, responsible for developing our communications strategy and conveying firm positions on accounting and financial reporting matters. She is the engaging host of PwC’s accounting and reporting weekly podcast and quarterly webcast series, as well as periodic webcasts for the power and utilities industry. With over 25 years of experience, Heather’s accounting and auditing expertise includes financial instruments and rate-regulated accounting.

Contact us

Heather Horn

Heather Horn

US Strategic Thought Leader, National Professional Services Group, PwC US

David Schmid

David Schmid

International Accounting Leader, National Professional Services Group, PwC US

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