Interpretive Guidance Updated for Revenue Recognition
New interpretive guidance is available regarding revenue recognition. On August 18, the Securities and Exchange Commission (“SEC”) issued Release No. 33-10402, Commission Guidance Regarding Revenue Recognition for Bill-and-Hold Arrangements, which advises public companies to abandon the guidance for bill-and-hold transactions under Accounting and Auditing Enforcement Release (“AAER”) No. 108, In the Matter of Stewart Parness, once they start applying Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 606, Revenue From Contracts With Customers. Until then, companies should continue using guidance under AAER No. 108. Another interpretive release issued was Release No. 33-10403, Updates to Commission Guidance Regarding Accounting for. Read More.
Topics: Accounting and Auditing Enforcement Release, Accounting Standards Codification, FASB, Financial Accounting Standards Board "FASB", Revenue Recognition, SEC, Securities and Exchange Commission "SEC", Staff Accounting Bulletin "SAB"
SEC’s Bricker Urges Implementation of Revenue Recognition Standard
Nearly 10 percent of public companies have not started to implement Accounting Standards Update No. 2014-09, Revenue From Contracts With Customers (Topic 606). While the percentage is insignificant, Securities and Exchange Commission (“SEC”) Chief Accountant Wesley Bricker is telling unprepared companies they have no option but to begin the implementation process. At a panel discussion during the SEC Speaks conference on February 25, Bricker said that companies cannot overlook the importance of the Financial Accounting Standards Board’s revenue recognition standard and must prepare accordingly. He encouraged companies to communicate their implementation plans with audit committees, executive teams and others, and. Read More.
Topics: FASB, Financial Accounting Standards Board "FASB", Revenue from Contracts with Customers (Topic 606), Revenue Recognition, SEC, Securities and Exchange Commission "SEC", Staff Accounting Bulletin "SAB"
Companies Advised to Use Established Internal Controls Guidance
Speaking last month on concerns regarding the reporting requirements for internal controls, Securities and Exchange Commission (“SEC”) Deputy Chief Accountant Brian Croteau recommended companies and auditors to use the agency’s existing two-part evaluation process. Per his speech at the American Institute of Certified Public Accountants’ Conference on Current SEC and Public Company Accounting Oversight Board Development, Croteau said companies should evaluate whether a material misstatement about their financial reporting controls is possible by using the interpretive guidance in Release No. 33-8810, Commission Guidance Regarding Management’s Report on Internal Control Over Financial Reporting Under Section 13(a) or 15(d) of the Securities. Read More.