Whether you like it or not, the impending effective date for ASC 606 is soon upon us all.
Don’t say we didn’t warn you.
Some of the bigger companies well into implementation efforts are finding as much work lies ahead as behind, according to commentary recently reported by Compliance Week, based on a Financial Executives International (FEI) conference.
Herewith, a sample platter of tidbits (it is post-Thanksgiving, after all, so we’ll refrain from serving up large portions. You’re welcome):
- Intel has done a review of contracts to understand how the new five-step method will change timing or pattern of revenue recognition, and is currently running this proposed impact by senior management and determining policies, procedures and system changes necessary for this new accounting through a series of mock closes.
- Boeing is just beginning the quantification phase following a detailed review of all contracts and auditor-approved process. The company’s assessment phase, according to Michael Cleary, vice president of accounting and financial reporting, was work-intensive and ever-evolving, as was the staff’s own understanding. Citing the extensive upheaval of the impending change, Cleary said the firm chose to develop a parallel system to track revenue under the new method. “This is a very significant impact for us,” he said.
- The Johnson & Johnson team spent quite a bit of time understanding the impact on all contracts and is into “the next leg of the journey” figuring out the impact on financial statements, according to Steve Rivera, the company’s worldwide senior director, financial compliance and procedures group.
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