Telecommunications Entities Revenue Recognition Task Force 


AICPA Revenue Recognition Task Forces are charged with developing revenue recognition implementation issues that will provide helpful hints and illustrative examples for how to apply the new Revenue Recognition Standard.

Task Force Members:

  • Nicole Zabinski, Ernst & Young LLP (Chair)
  • Cheryl Alford, Windstream Communications
  • Gregg Amend, Moss Adams
  • Bryan Anderson, Deloitte LLP
  • Doug Chambers, Telephone and Data Systems (TDS)
  • Martin Fuhs, T-Mobile
  • Monty Garrett, Verizon
  • Lyle Hippen, CenturyLink
  • Tom Leonard, PricewaterhouseCoopers LLP
  • Chris Morgan, Grant Thornton LLP
  • John Mutrie, Sprint
  • Bill Schneider, AT&T
  • Jason Waldron, KPMG LLP
  • Brian Zook, Liberty Global
Staff Contact: Desire Carroll, dcarroll@aicpa.org

News and Resources

In this audio podcast, Bill Schneider, CPA, CGMA, AT&T Director of Accounting discusses significant changes and challenges those in the telecommunications industry will encounter as a result of the new revenue recognition standard.


IDENTIFIED REVENUE RECOGNITION IMPLEMENTATION ISSUES

Below is a list of potential revenue recognition implementation issues identified by the Telecommunications Entities Revenue Recognition Task Force. The list will be updated as the task force continues it discussions. Full revenue recognition implementation issues will be posted below for informal comments after review by the AICPA Financial Reporting Executive Committee (FinREC).

Issue # Description of Implementation Issue Status
1 Accounting for individual contracts with customers versus Portfolio accounting
This implementation issue discuses considerations for telecommunication entities in determining when it is appropriate to apply ASC 606 on a portfolio or individual contract level.
Submitted to FinREC
2 Identification of separate performance obligations in the contract
TThis implementation issue discusses considerations for telecommunication and cable industry providers in determining which promises in an agreement represent performance obligations under ASC 606.
Submitted to AICPA RRWG
3 Accounting for contract modifications
This implementation issue discuses considerations for telecommunication entities in determining when it is appropriate to apply ASC 606 on a portfolio or individual contract level.
Submitted to AICPA RRWG
4
Accounting for contract costs (costs of obtaining a contract)
This implementation issue discusses the costs to obtain and fulfill contracts, including eligibility for deferral of such costs. Subsequent measurement (amortization and impairment) of deferred costs is also discussed.
Submitted to FinREC
5 Considering the effect of the time value of money
This implementation issue discusses how time value of money may impact the accounting for customer contracts in the telecommunication industry when there is a significant benefit of financing. In addition, financial statement presentation of the effects of financing will be discussed.
Submitted to AICPA RRWG
6
Determining whether a contract exists
This implementation issue discuses considerations for telecommunication entities in applying the guidance of ASC 606 when evaluating the impact of present enforceable rights and obligations on the contract term.
Submitted to FinREC
7 Material renewal rights in telecommunications contracts
This implementation issue discusses consideration for telecommunication entities determining the contract duration of a month-to-month service contract when the customer also purchases equipment under an equipment installment plan (EIP).
Submitted to AICPA RRWG
8
Step 3: Determine the transaction price
9
Step 4: Allocating the transaction price
10
Miscellaneous Revenue
This implementation issue discusses how to determine whether certain arrangements that result in miscellaneous receipts would meet the definition of a contract with a customer, and if could the miscellaneous receipts could be presented as revenue.
Submitted to AICPA RRWG
11 Indirect channel sales
12 Disclosure & Transitional Issues


The Telecommunications Entities Revenue Recognition Task Force recommends the following AICPA products for current revenue recognition issues:



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