ASC 606: Early results and lessons
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ASC 606: Early results and lessons

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Part of the CPEA ASC 606: Revenue Recognition Series

The new revenue recognition standard is now effective for calendar year public business entities and not-for-profit conduit debt obligors. Calendar year end SEC registrants have recently filed their first interim financial statements under the new revenue standard. Meanwhile, according to a Connor Group study, at least 33 entities early adopted the revenue recognition standard. Regulator review of these early adopters of the new revenue standard has started. As recognition and measurement under the new revenue standard is identical for public and private companies, we feel private companies need to closely monitor the experiences of public companies.

The CPEA continues to see increased implementation activity for private companies with member firms. In part I of this series, we detail four early results and lessons from our interaction with member firms and from the experiences of the current adopters of the new revenue recognition standard.

  • Staff Accounting Bulletin (SAB) Topic 13- An Incremental Burden for Private Companies

  • Customer Options for Additional Goods and Services that are a Material Right Identification and Magnitude Could Surprise

  • Determining the Unit of Account- Making the Distinctions (Identifying Performance Obligations)

  • Revenue Recognition for Work-In-Process- Enforceable Right to Payment for Performance to Date

In the second half of the series, we analyze areas of potential significant impact for some private companies:



  • New Incremental Assets- Capitalization of Costs Incurred to Obtain Contracts

  • An In-Depth Technical Examination of Recognition of Revenue Gross as a Principal vs. Net as an Agent

  • Disclosures

Download the First part I of the report on early lessons learned from revenue recognition adoption

File name: CPEA-early-lessons-rev-rec-1.pdf

Download the Second part of the report on early lessons learned from revenue recognition adoption

File name: CPEA-early-lessons-rev-rec-2.pdf

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