Newsmakers: FASB Staffers Discuss Board's Revenue Recognition Standard
a new standard on revenue recognition
A KPMG survey, taken at the beginning of 2016, showed that just 29 percent of firms had a clear plan to actually implement this standard, with 27 percent having taken no action at all to prepare. It’s now early in 2017, and there’s less than a year left before the standard becomes effective. What do you think is at the root of the difficulties that companies are having with preparation?Cullen Walsh: Of the firms that are well on track to being ready for implementation, do you find that they have anything in common? Are they clustered in a specific industry, do they have a certain type of governance structure, is there some kind of cultural commonality? Or is it across the board? Mary Mazzella: Since the final standard was released, it has been delayed by a year and slightly tweaked to account for licensing agreements on intellectual properties. Now there’s another proposal to make technical corrections and improvements. Why did the standard need these modifications even before the implementation date? Mazzella: If, in the next few months, we still see many companies unprepared to implement this standard, do you anticipate another delay in the effective date? Walsh: To what degree do you think needing to get ready for the leases standard, as well, is impacting people who are getting ready for the revenue recognition standard? Walsh: What aspects of the revenue standard do you find people having the most trouble with today? Mazzella: What is a common misconception about the standard that you’ve had to clear up numerous times? Walsh: What tends to surprise people the most about the new standard? Is there anything different that few have thought about? Mazzella: For a CPA, what is the most important thing to remember about the new standard? Walsh: The FASB’s revenue recognition website