Update: FASB Proposes Potential Deferral of the Effective Date of New Revenue Recognition Standard

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On April 1, 2015, the Financial Accounting Standards Board (FASB) decided to defer the effective date of the new revenue standard, Accounting Standards Update (ASU) 2014-09, Revenue from Contracts with Customers (Topic 606).  This proposed one-year delay is intended to provide entities adequate time to effectively implement the new standard.

The new revenue standard, which was officially issued by the FASB in May 2014, standardizes how companies should recognize revenue in financial statements under US Generally Accepted Accounting Principles (GAAP).

As a result of the proposed deferral, public entities would apply the new revenue standard to annual reporting periods beginning after December 15, 2017 and the first interim period within the year of adoption.  Nonpublic entities would apply the new revenue standard to annual reporting periods beginning after December 15, 2018 and the interim periods within the year of adoption.

Additionally, the FASB decided to allow both public and nonpublic entities to adopt the new revenue recognition standard early, but not before annual periods beginning after December 15, 2016 (which was the original public entity effective date).

The Board directed its staff to prepare an exposure draft which will have a 30-day comment period for the proposed update.

For more information on this update or other accounting standards, please contact your Aronson advisor at 301.231.6200.

About David H. Semendinger II

David H. Semendinger II has written 1 post in this blog.

David H. Semendinger II, CPA, leads Aronson LLC's Quality Control Group. With more than 24 years of public accounting experience, David's proactive approach to client service is the foundation of his strong business relationships. David has extensive experience in the areas of financial reporting and financial and operational controls, and his expertise extends to complex revenue recognition issues, equity and debt financing transactions, business combinations and related issues. He has managed numerous audits, reviews and compilations for a diverse set of companies, including those with annual revenues exceeding $1B. In addition, he has experience in the planning, documentation and testing of management's assertions on the effectiveness of internal controls (SOX 404 compliance). David is a Certified Public Accountant and a member of the AICPA. He earned a bachelor's degree from George Mason University and is a graduate of McGladrey's Business Advisor Program at the University of Chicago Graduate School of Business.

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