Changing Piling Up

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.

Revenue Recognition Graphic

Effective Dates

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.

Revenue Recognition Effective Dates Graphic

How Can BKD Help?

  • Develop transition plan
  • Analyze technology, controls and processes
  • Evaluate estimation process
  • Analyze contract
  • Assess overall business effect
  • Identify required disclosures

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