Recognizing the Impact of the New Revenue Recognition Rules

[tasmih1234]

The Financial Accounting Standards Board (FASB) and the International Accounting Standards Board (IASB) have issued their long-awaited converged standards on revenue recognition. The rules govern how and when revenue can be recognized in different industries. In essence, the new rule will do away with current industry-specific accounting practices and instead apply a single set of principles to all revenue transactions. Consequently, the new revenue recognition standards require changes on how organizations interact with suppliers, customer, regulators, and investors—and they will have a major impact on how functional areas interact within organizations.

In February 2015 APQC hosted a webinar, Revenue Recognition Transformation: Leading Change, Mastering Process & Driving Collaboration Enterprise-Wide, and, understandably, the webinar topic surfaced many questions about how organizations could understand the impact of the rules and make the necessary changes.

APQC and EY are examining what the change implies in terms belgium mobile numbers list of process excellence, cross-functional collaboration, and the finance organization’s role in driving a successful enterprise transition. We launched a four-part series on how organizations are preparing for the new revenue recognition rules, including interviews and advice from practitioners in finance and process and performance management that are already tackling the change. The purpose of the conversations is to identify best practices aligned with the four stages of change—(1) assessing the impact, (2) planning the needed changes, (3) implementing the plan, and (4) monitoring and continuous improvement.

In October, APQC and EY conducted the first series of discussions to find out how far along organizations are in addressing the new revenue recognition standards and what key steps they have taken to assess their impact on them.