Top 10 ASC Topic 606 Insights | CPE, Inc. Revenue Recognition Conference
Public and private companies should be preparing for the new revenue standard (ASC Topic 606) and begin the process of assessing the impact. The CPE, Inc. Revenue Recognition Conference in San Mateo, California in late March brought together an intimate group of accounting and consulting professionals for a two-day session to discuss the new revenue standard, current industry trends, and strategies for a successful adoption. A core team of experts, including three members of MorganFranklin’s Accounting & Transaction Services solution, led interactive panels and presentations to answer pressing questions and offer practical solutions for the successful transition of the new revenue standard.
Our team of advisors offered real-world guidance across a variety of topics:
Frequently Encountered Revenue Recognition Concerns under the Current Rules,Dee Mirando-Gould, Executive Director
Best Practices in Revenue Recognition Processes & Policies, Jordan Scheiderer, Senior Manager
Key Implementation Considerations to Ensure a Smooth Transition to the New Standard, Jordan Scheiderer, Senior Manager and Sergey Kvasnyuk, Senior Manager
ASC Topic 606: Beyond the Income Statement, Dee Mirando-Gould, Executive Director and Sergey Kvasnyuk, Senior Manager
Top Ten Conference Soundbites
Implementation of the new standard is a huge undertaking, but it’s important to remember this amendment was vetted through a lengthy, methodical process. FASB considered more than 900 comment letters for just one exposure draft before issuing the new standard.
As you’re starting to make assessments, pull in your tax people. Have those conversations early to assist in the planning and avoid surprises.
In some ways, the implementation of the new standard is starting over. The revenue accounting team should use it as an opportunity – for example, find efficiencies and become a closer partner to the business.
Engage your auditors early and often.
Understand your revenue streams. These may be your products, service types, or variations in contract terms.
Be proactive in your communications to stakeholders. The SEC is going to expect to see more robust disclosures around the anticipated impact on the financial statements as the adoption date gets closer.
If you are performing a system implementation, take advantage of this opportunity to consider the future accounting to ensure the system provides the information you need to report under the standard.
Be sure to think about your stock options if they include performance vesting tied to revenue. If you are thinking of issuing new options, you should consider how performance-based options will vest under the new standard.
Be sure to consider expected renewals even if there are no auto-renewals in your contract when determining the appropriate amortization period for capitalized costs to obtain a contract.
Be sure to match your amortization pattern of deferred costs to obtain and fulfill contracts to the pattern of recognizing revenue for the good or service.
Download our guide on ASC 606
Whether or not you’ve implemented already, our guide provides you steps in the right direction.
WHAT’S IN THE E-BOOK
Identify the strategic opportunities in compliance
How to engage and educate stakeholders across your company
How to meet unexpected challenges: the value of a dedicated project manager
How to build a path to compliance before your company’s reporting deadline
Why you need a customized adoption plan
Get up to speed on revenue recognition
Several methods may lead to compliance with the new ASC 606 revenue recognition standard, but only one is best for your company’s future growth. See how we can help you adopt ASC 606 by the fast-approaching deadline for private companies.