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Standards Update 6/5/20

Posted 3:45 PM by

The Financial Accounting Standards Board (FASB) regularly issues Accounting Standards Updates (ASUs) to make changes to the FASB Codification, the primary source of Accounting Principles Generally Accepted in the United States (GAAP).

On June 3, 2020, the FASB issued ASU No. 2020-05, Revenue from Contracts with Customers (Topic 606) and Leases (Topic 842): Effective Dates for Certain Entities (ASU No. 2020-05) to defer the effective dates of certain major accounting standards for which implementation challenges were amplified by disruptions caused by the COVID-19 pandemic. The deferred effective dates are noted below for each of the ASU’s impacted.

  • ASU No. 2016-02, Leases (Topic 842)

    Private companies and private not-for-profits (NFPs) now have a one-year deferral option to apply Topic 842 to fiscal years beginning after Dec. 15, 2021. NFPs 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 that have not yet issued financial statements as of June 3, 2020, now have a one-year deferral option to apply Topic 842 to fiscal years beginning after Dec. 15, 2019.
  • ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606)

    Private companies and NFPs that have not yet issued financial statements or made financial statements available for issuance as of June 3, 2020, now have a one-year deferral option to apply Topic 606 to annual reporting periods beginning after Dec. 15, 2019.

Effective Date and Transition

ASU No. 2020-05 is applicable for Topic 606 and Topic 842 as noted above. Early adoption of Topic 606 and Topic 842 is still permitted.

About the Author
Mike Lee is a partner in KSM’s Audit and Assurance Services Group. Mike works with clients to help them avoid risk and maximize efficiencies by keeping an eye on their bottom line and helping ensure accurate financial reporting. Connect with him on LinkedIn.

 

About the Author

Amanda Horvath is a director in Katz, Sapper & Miller’s Audit and Assurance Services Group. As a member of the firm’s Technical Resource Group, Amanda conducts technical accounting research that helps the firm ensure the quality of assurance engagements. Connect with her on LinkedIn.

 

About the Author
Matt Bishop is a director in Katz, Sapper & Miller’s Audit and Assurance Services Group. As a member of the firm’s Technical Resource Group, Matt is involved in technical accounting research and internal quality assurance processes, serving as a resource for KSM staff. Connect with him on LinkedIn.


About the Author
Jessica Boicourt is a manager in Katz, Sapper & Miller’s Audit and Assurance Services Group. As a member of the firm’s Technical Resource Group, Jessica is involved in technical accounting research and internal quality assurance processes, serving as a resource for KSM staff. Connect with her on LinkedIn.

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