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Since the issuance of the new revenue standard on May 28, 2014, the
FASB and the International Accounting Standards Board, along with stakeholders from
all industries, have focused on implementation efforts related to the adoption of
ASU 2014-09 and IFRS 15 (and related ASUs and IFRS® Standards). Since the
TRG’s initial formation in June 2014, there have been eight TRG meetings (including
two FASB-only TRG meetings), at which 52 staff papers in aggregate were discussed.
The feedback the FASB received through these meetings resulted in multiple ASUs
amending aspects of ASC 606 and related topics in the FASB Accounting Standards
Codification. Further, the FASB deferred the effective dates twice by
issuing ASU 2015-14 and ASU 2020-05.
The past several years have also seen significant activity by the 16
AICPA revenue recognition industry task forces. The task forces have worked on
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. In addition, at the July 20, 2017, EITF
meeting, the SEC staff provided significant relief to registrants that are required
to include financial statements or financial information of other reporting entities
in their SEC filings. Specifically, the SEC staff announced that it would not object
to elections by certain public business entities (PBEs) to use the non-PBE effective
dates for the sole purpose of adopting the FASB’s new standards on revenue and
leases.
The 2020 edition of Deloitte’s A Roadmap to Applying the New
Revenue Recognition Standard includes additional guidance and examples that
reflect (1) all significant standard-setting and SEC developments through the
September 16, 2020, FASB meeting and (2) our own interpretations in light of those
developments. In addition, we have reorganized much of the Roadmap’s content (e.g.,
by reformatting the Q&As of last year’s edition as narrative text) to present it
in a more user-friendly manner.
Although the new standard is now effective for most companies, 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.