Be Prepared and Proactive for the New Revenue Recognition Accounting Standards

Be Prepared and Proactive for the New Revenue Rec...

The FASB and IASB have approved a new accounting standard for revenue recognition that is expected to be issued in the near future, and which will be applicable for virtually all companies following either US GAAP or IFRS. This new standard will replace most of the current revenue recognition guidance, including those stemming from the FASB, the AICPA, and the EITF. Most of the industry specific revenue guidance will be eliminated, including guidance for software companies, construction contractors, and many others. It is critical for both public and non-public companies to begin understanding the requirements of the new standard and assessing the impact on financial reporting. Companies expecting changes to accounting policies or disclosures are advised to be proactive in further assessing the implications of implementing this new standard, including the broader impacts on their business.Implementing the Forthcoming Revenue Recognition Standard we provide an overview of factors that should be considered when addressing the new standard along with matters to be evaluated when determining the degree to which an organization could be affected.

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Matters discussed in the Defining Issues include:

  • Identifying changes to accounting policies and disclosures
  • How the selection of a transition approach will impact your implementation plan
  • The role of systems in gathering information to apply the new standard
  • Internal control considerations
  • Tax implications
  • Impact on financial and business practices
  • Coordinating with stakeholders
  • SEC filer considerations
  • When to start your assessment process

For information on how KPMG can help your organization prepare and develop an implementation plan please contact Stephen Thompson, KPMG LLP.

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