The US Financial Accounting Standards Board (FASB) has issued a limited number of technical corrections and improvements to its previously released update on the proposed new standard for Revenue from Contracts with Customers, which it is consulting on ahead of the eventual release of the final standard
FASB previously issued proposed Accounting Standards Update, Technical Corrections and Improvements to Update No. 2014-09, Revenue from Contracts with Customers (Topic 606): Additional Corrections in May 2016. The amendments in the proposed update included nine technical corrections and improvements, which the board is in the process of redeliberating.
The latest proposed update, which has just been released contains amendments to four additional items that were brought to FASB’s attention after the initial deliberations of the May 2016 proposed update.
These relate to loan guarantee fees; an example illustrating the application of the presentation guidance on contract assets and receivables; an example where a refund liability appeared to be characterised as a contract liability; and reinstating guidance on the accrual of advertising costs.
The amendments in this latest proposed update would affect the guidance in Update 2014-09, which is not yet effective. The anticipated effective date and transition requirements for the proposed amendments would be the same as the effective date and transition requirements for Topic 606 (and any other Topic amended by Update 2014-09). Accounting Standards Update No. 2015-14, Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date, defers the effective date of Update 2014-09 by one year.
Comments on the Exposure Draft are requested by 4 October.
Technical Corrections and Improvements to Update No. 2014-09, Revenue from Contracts with Customers (Topic 606) Additional Corrections is here.