In a recent on-line post, Compliance Week writer, Tammy Whitehouse detailed a survey which found that many private company CFOs are unaware of the FASB’s almost completed guidance on revenue recognition (http://www.complianceweek.com/cfos-largely-unaware-of-pending-revenue-rule/article/300409/).
The FASB’s technical plan indicates that the final revenue recognition guidance will be out in the 3rd quarter of 2013.
Participants in the survey, which was conducted by Grant Thornton LLP, a global accounting and professional services firm, included 1,300 CFOs from public and private companies of all sizes. Of all CFO respondents, the survey found that 54% indicated that they were unaware of the pending revenue recognition guidance. CFOs from larger companies were more aware of the pending guidance than those from smaller companies. For example, Ms. Whitehouse indicates that 72% of CFOs from companies with revenue exceeding $5 billion dollars indicated that they were aware of the pending guidance while only 38% of CFOs from companies generating less than $100 million of revenue indicated that they were aware of the pending guidance.
Interestingly, since issuing their initial discussion paper in 2008, the FASB has actively worked with preparer and user groups to communicate their goals for the project. They have discussed this project at major industry conferences and workshops, professional and academic conferences, and via podcasts and webcasts. A summary of their outreach activities can be obtained from their website (http://www.fasb.org/cs/ContentServer?site=FASB&c=Document_C&pagename=FASB%2FDocument_C%2FDocumentPage&cid=1176160060527).
As pointed out in the Compliance Week article, CFOs need to become aware of the pending guidance because, for some industries, the guidance will significantly change the way revenues are measured and reported.
Interested parties can learn about the guidance through multiple sources, but, I recommend the project page at the FASB’s website (http://www.fasb.org/cs/ContentServer?c=FASBContent_C&pagename=FASB%2FFASBContent_C%2FProjectUpdatePage&cid=900000011146).