PwC comments on GASB’s revenue and expense recognition project
Changes are coming for GASB entities. See our thoughts on the GASB’s revenue and expense recognition project.
Overview
PwC has responded to the GASB’s Invitation to Comment on its revenue and expense recognition project. Among the three possible revenue and expense recognition approaches for exchange transactions, PwC favors the “alternative model,” which would look at performance obligations similar to how they are understood under ASC 606, so would align GASB and FASB standards on revenue recognition. It would also provide logical accounting answers for a range of revenue transactions. Use of the “alternative model” would allow governments to leverage existing guidance for nonexchange transactions.
PwC also encourages the GASB to develop implementation guidance, including examples, to ensure a consistent understanding of how to apply the new model.
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