ASC 606 implementation – don’t forget internal controls and disclosures

Applicability

Applying the new revenue recognition standard

• All companies

Effective dates

Mandatory effective dates and early adoption provisions:

Annual periods:

For public business entities and certain other entities the effective date for annual periods is the fiscal years beginning after Dec. 15, 2017.

For all other entites the effective date for annual periods is the fiscal years beginning after Dec. 15, 2018.

Interim periods:

For public business entities and certain other entities the effective date for interim periods is the fiscal years beginning after Dec. 15, 2017.

For all other entites the effective date for interim periods is the fiscal years beginning after Dec. 15, 2019.

Early adoption:

For public business entities and certain other entities the effective date for early adoption is the fiscal years beginning after Dec. 15, 2016.

For all other entites the effective date for early adoption is the fiscal years beginning after Dec. 15, 2016.

* (1) public business entities; (2) not-for-profits that have issued, or are conduit bond obligors for, securities that are traded, listed or quoted on an exchange or an over-the-counter market; and (3) employee benefit plans that file financial statements with the SEC.

• Implementation is not just accounting
• New or modified controls required even if financial results are unchanged
• One-time controls over transition will need to be established
• Significantly expanded disclosure requirements
• SEC continues to focus on SAB 74 disclosures
• Reminder on effective dates