We are pleased to present the 2023 edition of Revenue Recognition. This Roadmap provides Deloitte’s insights into and interpretations of the accounting guidance in the revenue standard, which was issued in May 2014 by the FASB as ASU 2014-091 and by the International Accounting Standards Board (IASB®) as IFRS 15.2
Since the original release of the revenue standard, the FASB and IASB, along with stakeholders from all industries, have focused on implementation efforts related to the standard’s adoption. In June 2014, a joint FASB/IASB transition resource group (TRG) for revenue recognition was created to discuss implementation issues related to the revenue standard and help the boards resolve any such issues that could give rise to diversity in practice. There have been eight TRG meetings (including two FASB-only TRG meetings), at which 52 staff papers in aggregate were discussed.3 The feedback the FASB received through these meetings resulted in the issuance of (1) multiple ASUs amending aspects of ASC 606 and related topics in the FASB Accounting Standards Codification (the “Codification”) and (2) the FASB staff’s Revenue Recognition Implementation Q&As compiled from previously issued educational materials.
In addition, the 16 AICPA revenue recognition industry task forces produced industry-specific interpretive guidance on the revenue standard. The task forces have developed updates to the AICPA’s industry guides that address over 130 accounting matters related to revenue recognition, presentation, and disclosure.
The SEC staff has been active as well. In addition to monitoring implementation efforts and discussing its expectations for transparent disclosures, the staff has updated its revenue guidance with the issuance of SAB 116, which effectively supersedes SAB Topic 13.
The 2023 edition of this Roadmap includes additional guidance and examples that reflect (1) significant standard-setting and SEC developments through November 10, 2023, and (2) our own interpretations in light of those developments. Key changes made to this Roadmap since publication of the 2022 edition are summarized in Appendix F.
We hope that this update will enable you to navigate some of the more challenging aspects of the revenue standard. This publication has been developed for readers who have studied every aspect of the standard, as well as for readers who may be working through the standard to determine how to account for new revenue streams. That is, it may function as a quick resource guide for those who have a specific question and are looking for a clear answer, or it may serve as an all-encompassing guide for those who are still building up their knowledge base to work through an implementation issue. We expect additional implementation challenges to arise as (1) business models emerge or evolve and (2) contracts are created or amended. Accordingly, we will continue to develop guidance that we believe will help stakeholders with interpreting the standard.
We encourage you to use this Roadmap as a guide throughout your application of the revenue standard and to contact us with any questions or suggestions for future improvements. However, the Roadmap is not a substitute for consulting with Deloitte professionals on complex accounting questions and transactions. We look forward to helping you address whatever implementation questions you have.
As used in this publication, references to the revenue standard may denote the guidance, as originally issued or amended, in (1) ASU 2014-09 (or IFRS 15) broadly or (2) ASC 606 (or IFRS 15) on revenue from contracts with customers specifically. In addition to the guidance in ASC 606 on revenue from contracts with customers, the guidance in ASU 2014-09, as originally issued or amended, includes (1) the cost guidance in ASC 340-40 and (2) the guidance in ASC 610-20 on gains and losses on transfers of nonfinancial and in-substance nonfinancial assets to noncustomers. IFRS 15, as originally issued or amended, includes the guidance on revenue from contracts with customers and the related cost guidance but does not include guidance similar to that in ASC 610-20 under U.S. GAAP.
In total, the FASB issued 60 TRG Agenda Papers consisting of 52 staff papers, 6 meeting summaries, and 2 research updates.