We are all about numbers so here are a few to mull over…
75 (the percentage of respondents yet to complete an impact assessment for the new revenue recognition guidance from a survey of companies in a variety of industries conducted this past summer by PricewaterhouseCoopers (PwC) and Financial Executives Research Foundation (FERF))
27 (the percentage of folks who haven’t even started any assessment, same survey)
59 (the percentage of 2,200 CFOs surveyed by Robert Half Management Resources – compared to the 335 respondents in the PwC survey – admitting to not yet starting diagnostic work to determine the level of effort necessary to transition to the new guidance)
Why the foot dragging on such a game changer in the world of revenue recognition?
Many point to the much-publicized hemming and hawing and eventual approval of a one-year delay in the effective date for the new standard as a reason, but if you listen to the experts, that shouldn’t be used as an excuse.
In a recent interview for CGMA Magazine, Dusty Stallings, a CPA and member of PwC’s professional services group, said the new standard, though “moving around a little,” is mostly done.
“There is a lot of work that companies can go ahead and do that won’t be affected by any changes that FASB and the IASB make,” Stallings said. “So if that’s the reason for your delay, I think one of the priorities should be to put that behind you and move on.”
Closer to home, Leeyo has been busy conducting a series of webinars and workshops in conjunction with the new standard and our own RevPro3® over the past several months. A compilation of our event surveys of several hundred professionals in the revenue industry by and large bear out earlier findings on the lack of readiness for the new guidance across the board.
More numbers, these gathered by us directly, for your viewing and processing purposes…
49 (the percentage of respondents to Leeyo currently in the ‘assessment’ phase of their implementation of the new revenue recognition standard)
28 (the percentage who hasn’t started their implementation yet)
46 (the percentage of folks targeting an adoption timeline of 12-18 months for the new guidance)
24 (the percentage of folks estimating 18 months or longer to adopt the new guidance)
65 (the percentage of respondents yet to select a transition method for the new guidance)
Still a lot of unreadiness out there, clearly.
It’s past the time to get started on this effort, but many organizations still aren’t sure how to begin. Here is one handy checklist, courtesy of the folks at Robert Half:
1) Perform a diagnostic and readiness assessment to determine steps the organization must take to be ready for the transition.
2) Educate senior management on upcoming changes and the resources required to meet the demands of the updated guidelines.
3) Identify all employees who will be involved in the process.
4) Pinpoint the expertise current staff possess and the potential skills gaps to address.
5) Assess positions requiring additional full-time hires and areas where external subject-matter experts, such as consultants, are needed.
6) Implement a training program to bring all employees involved up to speed.
7) Communicate project milestones and deadlines to the executive team and staff working on revenue recognition initiatives.