FASB Discusses Topic 606 Pre-Agenda Research
At its meeting earlier this month, the Financial Accounting Standards Board (“FASB”) reviewed pre-agenda research for updates to Accounting Standards Update (ASU) No. 2014-09, Revenue from Contracts with Customers (Topic 606). In particular, the discussion focused on certain disclosure requirements for remaining performance obligations. The FASB agreed to add a practical expedient to the requirement for disclosing remaining performance obligations for certain types of variable consideration. Also agreed upon were improvements to the qualitative disclosure requirement for remaining performance obligations in paragraph 606-10-50-15. The following types of variable consideration would not be required in an entity’s disclosure of its remaining. Read More.
FASB Updates Guidance for Principal versus Agent Revenue Accounting
Improving the implementation guidance regarding principal versus agent revenue considerations, the Financial Accounting Standards Board (“FASB”) has issued Accounting Standards Update (ASU) No. 2016-08, Revenue from Contracts with Customers (Topic 606): Principal versus Agent Considerations (Reporting Revenue Gross versus Net). The amendments in ASU No. 2016-08 clarify the following: A company must determine the nature of each specified good or service promised to a customer (e.g., a good/service itself or right to a good/service). Then a company decides whether it is acting in the capacity as a principal or agent for each individual good or service promised to a customer.. Read More.