Revenue Recognition: Finalizing Organizational Reporting Changes for the New Standard

Converging U.S. standards from the Financial Accounting Standards Board (FASB) with standards from the International Accounting Standards Board (IASB), a new joint standard, commonly known in the U.S. as ASC 606  was published on May 28, 2014 to create a single standard for all contracts with customers. With implications for both external financial reporting and core systems for generating reports, the new standard will dictate how and when revenue can be recognized. Most organizations will be affected in some way.

In 2015 and 2016, APQC and EY conducted a series of interviews and virtual roundtables to examine what this change implies in terms of process excellence, cross-functional collaboration, and the finance organization’s role in driving a successful enterprise transition. 

This white paper outlines the new revenue recognition rules, as well as the phases of change occurring at many organizations. The paper also outlines key considerations from organizations leading the change efforts for compliance.