FASB Seeks Public Comment on Proposal to Defer Effective Date of Revenue Recognition Standard

The Financial Accounting Standards Board (FASB) today issued for public comment a proposed Accounting Standards Update (ASU) that would defer the effective date of its new revenue recognition standard by one year. Stakeholders are encouraged to review and provide comment on the proposal by May 29, 2015.

The proposed ASU, Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date, would permit public organizations to apply the new revenue standard to annual reporting periods beginning after December 15, 2017. Nonpublic organizations would be permitted to apply the new revenue standard to annual reporting periods beginning after December 15, 2018.

Public organizations would apply the new revenue standard to interim reporting periods within annual reporting periods beginning after December 15, 2017 (that is, a public organization would be required to apply the new revenue standard beginning in the first interim period within the year of adoption). Nonpublic organizations would apply the new revenue standard to interim reporting periods within annual reporting periods beginning after December 15, 2019 (that is, a nonpublic organization would not be required to apply the new revenue standard in interim periods within the year of adoption).

Additionally, the proposed ASU would permit both public and nonpublic organizations to adopt the new revenue standard early, but not before the original public organization effective date (that is, annual periods beginning after December 15, 2016).

The proposed ASU—including instructions on how to submit comments—is available at www.fasb.org.

About the Financial Accounting Standards Board

Since 1973, the Financial Accounting Standards Board has been the designated organization in the private sector for establishing standards of financial accounting and reporting. Those standards govern the preparation of financial reports and are officially recognized as authoritative by the Securities and Exchange Commission and the American Institute of Certified Public Accountants. Such standards are essential to the efficient functioning of the economy because investors, creditors, auditors, and others rely on credible, transparent, and comparable financial information. For more information about the FASB, visit our website at www.fasb.org.