A guide to revenue recognition assists middle-market companies in applying the revenue recognition model in Topic 606, “Revenue from Contracts with Customers,” of the Financial Accounting Standards Board’s (FASB) Accounting Standards Codification (ASC). ASC 606 provides a robust framework for recognizing revenue, and upon its effective date, replaced almost all pre-existing revenue recognition guidance, including industry-specific guidance, in U.S. generally accepted accounting principles (legacy GAAP).
Our comprehensive guide includes in-depth discussion and numerous examples on:
- All the critical aspects of ASC 606, including its scope, five-step revenue recognition model, and presentation and disclosure requirements
- The related guidance in:
- ASC Subtopic 340-40, “Other Assets and Deferred Costs – Contracts with Customers"
- ASC Subtopic 610-20, “Other Income – Gains and Losses from the Derecognition of Nonfinancial Assets”
- Commonly asked questions that arise in practice
- Significant differences between the new guidance and legacy GAAP
For a condensed discussion of the important concepts in ASC 606, refer to the executive summary in Chapter 1 of the guide. The May 2024 edition of the guide has been updated to address various issues encountered in practice. A summary of the significant changes made in the May 2024 edition can be found in Appendix F of the guide.
