For accountants, and in fact, business owners all over the world, 1 January 2018 signals more than just a glass of bubbly, a few fireworks and a sparkly hat – it’s the launch of a completely new set of accounting standards – one that organisations globally are trying to get themselves up to speed on.
On 15 December this year, the FASB’s (Financial Accounting Standards Board) new revenue recognition standards will go into effect. The new set of standards will focus on the nature of the revenue, the timing of the revenue and the certainty (or uncertainty) of contracts.
The reason for this change is explained by the FASB as follows:
- Removes inconsistencies and weaknesses in existing revenue requirements
- Provides a more robust framework for addressing revenue issues
- Improves comparability of revenue recognition practices across entities, industries, jurisdictions, and capital markets
- Provides more useful information to users of financial statements through improved disclosure requirements, and
Simplifies the preparation of financial statements by reducing the number of requirements to which an organisation must refer.
If you need to know more about how this affects you, and how we can help – get in touch with us today.