FASB decides to defer revenue recognition

International Tax Review is part of Legal Benchmarking Limited, 1-2 Paris Garden, London, SE1 8ND

Copyright © Legal Benchmarking Limited and its affiliated companies 2026

Accessibility | Terms of Use | Privacy Policy | Modern Slavery Statement

FASB decides to defer revenue recognition

fotolia-77736023-subscription-monthly-m-accountingstandards.jpg

Taxpayers which use US Generally Accepted Accounting Principles (GAAP) in their financial reporting will get an extra year to implement the new revenue recognition standard after the Financial Accounting Standards Board (FASB) decided at its meeting on April 1 to defer its effective date.

Those entities which follow US GAAP will now have to apply the standard (Accounting Standards Update 2014-09) to their annual and interim reporting for periods after December 15 2017, rather than a year earlier. Private companies will have another year after this to incorporate the standard into their annual reporting and another year after that, that is, December 15 2019, to use it for their interim reporting.

All companies, both public and private, will be allowed to adopt the standard earlier than December 15 2017 if they want to, but not before December 15 2016, the original effective date for public entities.

FASB’s board has directed staff to draft a proposed Accounting Standards Update, with a 30-day comment period, to reflect these decisions.

FASB and the International Accounting Standards Board, which oversees the development of International Financial Reporting Standards (IFRS), issued a converged standard on revenue recognition in May 2014.

At the time, a joint statement from the two organisations said:

“The core principle of the new standard is for companies to recognise revenue to depict the transfer of goods or services to customers in amounts that reflect the consideration (that is, payment) to which the company expects to be entitled in exchange for those goods or services. The new standard also will result in enhanced disclosures about revenue, provide guidance for transactions that were not previously addressed comprehensively (for example, service revenue and contract modifications) and improve guidance for multiple-element arrangements.”





more across site & shared bottom lb ros

More from across our site

An OECD report on taxation of the digital economy is expected by the end of 2026, according to the group of nations
Trophy assets are evolving from personal indulgences to structured investments, prompting family offices to prioritise tax efficiency, governance discipline, and cross-border compliance
As demand for complex, cross-border private client counsel spikes, Patrick McCormick sees opportunity in starting from scratch
As part of an exclusive global alliance, KPMG will become one of Anthropic’s ‘preferred consultants’ for private equity
In the second part of this series, the focus shifts to how taxpayers can manage ongoing risks across the lifecycle of cross-border structures
Jurisdictions have moved to ensure that multinationals are not punished for late GIR filings due to a lack of available filing portals or exchange relationships
HMRC’s push for unified tax adviser registration won’t prevent every instance of improper conduct, but it is good for taxpayers and the UK’s reputation
Elsewhere, the UAE’s tax office has issued an update on registration penalties and two firms have been busy making lateral hires
The case sits within a context of Brazil signalling that it is replacing informal discretion and ambiguity with structures that reward analytical rigour, one expert tells ITR
Jeff Soar lifts the lid on WTS UK’s ambitious recruitment plans, the firm's positioning against the big four, and why tax is the perfect profession for AI
Gift this article