Power and Utility 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:

  • James Barker, Deloitte LLP (Co-Chair)
  • Randall Hartman, Edison Electric Institute (Co-Chair)
  • Steve Breininger, PPL Electric
  • Noel Christmann, Entergy
  • Lori Colvin, SouthWest Gas
  • Zach Deakins, Calpine
  • Dennis Deutmeyer, Ernst & Young LLP
  • Beth Farr, NextEra
  • Darin Kempke, KPMG LLP
  • Matt Kim, Chesapeake Utilities
  • Joe Martin, American Gas Association
  • Jim Nowoswiat, Baker Tilly Virchow Krause, LLP
  • Tom Reichart, Exelon
  • Sean Riley, PricewaterhouseCoopers LLP
  • Eric Thiergartner, American Electric Power
Staff Contact: kim.kushmerick@aicpa-cima.com

IDENTIFIED REVENUE RECOGNITION IMPLEMENTATION ISSUES

Below is a list of potential revenue recognition implementation issues identified by the Power and Utilities 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 Scope Clarification Regarding Tariff Sales to Regulated Customers
This implementation issue discusses whether revenues from sales under a regulated utility’s tariff (other than revenues from alternative revenue programs specifically excluded from the scope of Topic 606) are within the scope of Topic 606
Finalized to be included in a future edition of the AICPA Guide Revenue Recognition
2 Accounting for Contracts with Price and/or Volume Variability
This implementation issue discusses applying Topic 606 to variable-volume power & utilities contracts, and whether such contracts constitute variable consideration or whether optional volumes under such contracts represent a marketing offer for optional purchases.
Out for exposure until October 2, 2017
3
Strip vs. Step Price Arrangements
This implementation issue will addresses strip (constant fixed price per unit delivered) and step (increasing fixed price per unit delivered) pricing conventions applied to the same seller performance (delivery of a fixed quantity of commodity units consecutively over a multi-year term).
Submitted to FinREC - July 2017
4
Application of Series Guidance to Storable Commodities
This implementation issue will discuss considerations for applying the series guidance described in ASC 606-10-25-14 and 25-15 to sales involving commodities other than electricity.
Submitted to AICPA RRWG
5
Accounting for contract modifications
This implementation issue discusses blend-and-extend modifications (whether they include a financing element), as well as treatment of partial terminations.
Question submitted to FASB TRG
6
Partial terminations
This implementation issue discusses how to apply the guidance in Topic 606A to P&U contracts with a customer for a performance obligation satisfied over time, that is later terminated for only a discrete unsatisfied portion of that contract.
Submitted to AICPA RRWG
7
Accounting for Bundled Arrangements
This implementation issue discusses the requirement to assess multiple element arrangements under ASC 606, and the appropriate timing of revenue recognition for electricity and capacity sales.
Submitted to FinREC - July 2017
8
Revenue timing for RECs
This implementation issue discusses the requirement to assess multiple element arrangements under ASC 606, and the appropriate timing of revenue recognition for RECs.

Submitted to FinREC - July 2017
9
Contributions in Aid of Construction
This implementation issue discusses the application of Topic 606 to regulated utility accounts for Contributions in Aid of Construction (CIAC).
Submitted to AICPA RRWG
11
Collectibility
This implementation issue discusses how to assess whether regulated utility tariff sales meet the collectilibity criterion in Topic 606.
Submitted to AICPA RRWG
12
Income Statement Display of Alternative Revenue Programs
This implementation issue discusses income statement presentation of alternative revenue programs.
Submitted to AICPA RRWG


FEEDBACK REQUESTED

Draft Revenue Recognition Implementation Issues included for informal comment, when available, will be listed below.

Respondents should submit any comments including the implementation issue number to kim.kushmerick@aicpa-cima.com by the dates noted below:

Issue # Comment Due Date
13-1 -  Accounting for Tariff Sales to Regulated Customers May 1, 2017
13-2 - Requirements and Similar Contracts with Variable Volumes October 2, 2017





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