Buchanan Ingersoll & Rooney Tax attorney Lisa M. Starczewski recently penned an article published in the Institute of Finance & Management’s (IOFM) September Controller’s Report, titled “Update on the New Revenue Recognition Standard.”
In her article, Starczewski explores how companies should be examining their contracts and business models with new eyes as a result of the new Revenue Recognition Standard – a standard which converges the U.S. Generally Accepted Accounting Principles with the International Financial Reporting Standards.
“The ultimate goal of the Revenue Recognition Standard is a more useful set of financial statements for investors,” she writes. In order to help achieve consistency with respect to revenue recognition across industries and transaction types, The Financial Accounting Standards Board (FASB) and The International Accounting Standards Board (IASB) have eliminated industry-specific guidance.
Starczewski’s article offers insight on key developments of which controllers should be aware, while noting that there is no “one size fits all” approach when it comes to assessment.
“Implementing the new standard will be a heavy lift for many companies. A delayed effective date may serve as a temptation to delay or take a break from the work that needs to be done—but companies should resist this temptation and continue on in their efforts,” Starczewski says.