Jun 01, 2015
From the Financial Reporting Network
KPMG LLP recently commented on the proposed FASB ASU, Deferral of the Effective Date, which would defer the effective date of the revenue recognition standard by one-year for all entities. Early application would be permitted, but not before the original effective date for public business entities (annual reporting periods beginning after December 15, 2016).
KPMG commented that a one-year deferral of the required effective date is appropriate because some of the FASB activities to amend and clarify the guidance in the revenue standard are fundamental to the application of the model. Many entities, particularly those whose accounting policies and disclosures will be significantly affected and those awaiting further clarifications from the Board, may need the extra year to effectively develop and implement changes to their accounting policies, systems, processes, and internal controls to apply the standard. KPMG supports the Board’s proposal to allow entities to adopt the new standard as of the original effective date. The firm also suggested that the staff clarify the transition guidance about when an entity is deemed to have transferred all of the goods or services identified (or fully performed) in accordance with the revenue guidance that is in effect before the date of initial application.