The International Accounting Standards Board (IASB) and the U.S. Financial Accounting Standards Board (FASB) yesterday announced the new joint standard on revenue recognition. This replaces the guidance on revenue recognition that currently exists under U.S. Generally Accepted Accounting Principles (U.S. GAAP) and International Financial Reporting Standards (IFRS).
KPMG LLP has spokespeople who can discuss the history of the joint standard and how organizations can implement new revenue recognition policies: Prabhakar Kalavacherla “PK”, a partner in the Audit Quality and Professional Practice group, and Stephen Thompson, Accounting Change Services Lead Partner for Revenue Recognition.
For many companies, implementation of the new standard is not just an accounting exercise, as it will have broad impact across organizations; it may require groups from throughout an organization to get involved, including resources from information technology, taxes, internal controls, processes, legal and other business areas.
Although the new standard doesn’t take effect until fiscal years beginning after December 15, 2016, many companies will find that an early assessment of the new standards’ impact across the organization will allow them to develop an efficient and timely implementation plan, and leave sufficient time to include systems implementation as part of the solution.
The standards impact all companies, particularly organizations in the software, real estate, aerospace and defense, telecommunications and media sectors, among others.
The new standard, which has been more than 12 years in the making, was released jointly by FASB/IASB on May 28. Publicly-held companies will have until Jan. 1, 2017, to comply and early application is not allowed; private companies may defer the changes up to 1 year.
About Prabhakar Kalavacherla “PK”, Partner in the Audit Quality and Professional Practice group – San Francisco
PK rejoined KPMG earlier this year, after completing a five-year term with the IASB, where he was actively involved in developing the Revenue Recognition accounting standards, and also worked in critical financial reporting areas, including all aspects of financial instruments, leases, insurance accounting, consolidations and fair value measurements.
About Stephen Thompson, Accounting Change Services Lead Partner for Revenue Recognition - Chicago
Steve assists companies with implementing new revenue recognition guidance and policies, and advises clients on U.S. GAAP technical accounting matters. He is a frequent speaker on matters related to revenue recognition.
About KPMG LLP
KPMG LLP, the audit, tax and advisory firm (www.kpmg.com/us), is the U.S. member firm of KPMG International Cooperative (“KPMG International”). KPMG International’s member firms have 155,000 professionals, including more than 8,600 partners, in 155 countries.