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AICPA Issues Rev Rec Drafts

AICPAThe Financial Reporting Executive Committee of the American Institute of CPAs has issued seven working drafts regarding upcoming changes to revenue recognition standards. The drafts, related to the implementation of Accounting Standards Update (ASU) No. 2014-09, Revenue from Contracts with Customers, are for asset management, gaming, software and telecommunications.

The standards update will replace transaction- and industry-specific revenue recognition guidance under current U.S. GAAP with a principle-based approach. The AICPA set up 16 industry tax forces to develop develop a new Accounting Guide on Revenue Recognition. The release of the seven new working drafts means that implementation issues for 10 out of 16 industry task forces have been exposed for informal comment.

The largest number of issues in the drafts involve software. These are as following: Determining Whether Software Intellectual Property Is Distinct in Cloud Computing Arrangements; Issue #14-4(A): Defining and Identifying Potential Price Concessions; Issue #14-4(B): Estimating the Standalone Selling Price of Options that are Determined to Be Performance Obligations; and Issue #14-6: Estimating the Standalone Selling Price.

The others released asAsset Management, Issue #10-6: Recognition of Contingent Deferred Sales Charges;  Gaming, Issue #6-4: Accounting for Base Progressive and Incremental Progressive Jackpot Amounts; and Telecommunications, Issue #15-12: Disclosure and Transition.

Interested parties are encouraged to submit feedback by December 5.

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