2/17/2012 3:44:00 PM
The International Accounting Standards Board (IASB) and the Financial Accounting Standards Board (FASB) have recently published important exposure drafts on “Revenue from Contracts with Customers.” The proposed joint standard seeks to clarify the principles for recognizing revenue and to adopt a single revenue model for both International Financial Reporting Standards (IFRS) and US Generally Accepted Accounting Principles (US GAAP) reporters, across industries and markets. If adopted, this would represent a significant step toward global convergence in financial reporting.
These proposed standards will likely result in significant changes in the key financial performance measures of many companies, in many industries. For most, this will require changes to the business management systems that measure and recognize revenue, as well as updates to revenue recognition process controls. Although the effective date is no earlier that January 1, 2015, it’s not too early to prepare, since this may take substantial planning and effort to implement, depending on your company’s current contract and revenue processes.
Tensoft will be providing further insight to our customers, partners and other interest parties, including an upcoming webcast on March 13 – just in time to help inform any additional comments that you’d like to make on the exposure drafts!