On The Horizon - March 26, 2013

FASB

Board discusses revenue recognition at March 20 meeting

All decisions reached at Board meetings are tentative and may be changed at future meetings. Decisions are included in an Exposure Draft only after a formal written ballot. Decisions reflected in Exposure Drafts are often changed in redeliberations by the Board based on information received in comment letters, at public roundtable discussions, and from other sources. Board decisions become final after a formal written ballot to issue a final Accounting Standards Update.

On March 20, the Board resumed its discussion of the revised Exposure Draft, Revenue from Contracts with Customers (the 2011 ED), concentrating on the disclosure, transition, and effective date requirements for nonpublic companies, which are discussed below.

Disclosures

The Board tentatively decided not to specify interim disclosure requirements for nonpublic entities. In addition, the Board tentatively decided, or affirmed previous tentative decisions, that the following disclosure requirements would be optional for nonpublic entities:

Quantitative disclosures about disaggregated revenue in paragraphs 114 and 115 of the 2011 ED

Disclosures about contract balances and assets recognized from the costs to obtain or fulfill a contract with a customer The amount of the transaction price allocated to the remaining performance obligations and an explanation of when the entity expects to recognize that amount as revenue For performance obligations satisfied over time, an explanation of why methods used to recognize revenue over time are a faithful depiction of the transfer of goods or services For performance obligations satisfied at a point in time, significant judgments made in evaluating when the customer obtains control of promised goods or services Information about methods, inputs, and assumptions used to Determine the transaction price Estimate stand-alone selling prices of promised goods or services Measure obligations for returns, refunds, and other similar obligations Transition

The Board tentatively decided that nonpublic entities would not be afforded an alternative transition method. Refer to the February 26 edition of On the Horizon for a summary of the tentative transition guidance.

Effective date

The Board also tentatively agreed that nonpublic entities would apply the proposed guidance for annual reporting periods beginning after December 15, 2017 and for interim and annual periods thereafter.

Nonpublic...