The model for revenue recognition is changing with the Financial Accounting Standards Board’s (FASB) May 28, 2014, release of Accounting Standards Update (ASU) 2014-09, Revenue from Contracts with Customers (Topic 606). The ASU eliminates most of the existing industry-specific guidance and significantly expands revenue recognition disclosures. More than 600 pieces of current revenue recognition guidance are replaced with an overriding principle and a five-step model. The standard requires entities to make more estimates and use more judgment than under current guidance.
Due to the unprecedented effects of COVID-19, FASB approved a deferral for all entities for financial statements that have not yet been issued or made available for issuance.
How Can BKD Help?
- Develop transition plan
- Analyze technology, controls and processes
- Evaluate estimation process
- Analyze contract
- Assess overall business effect
- Identify required disclosures