Overview
For those entities who formerly recognized revenue under the guidance of Statement of Position 81-1, Accounting for Performance of Construction-Type and Certain Production-Type Contracts (SOP 81-1/ASC 605-35), understanding the basics of Topic 606 is not enough. In order to effectively apply Topic 606, you need a detailed understanding of how to recognize revenue over time under Topic 606’s Five-Step model.
Even though Topic 606 is currently effective, changes in business and contracts will always require the need to stay current on this topic. Now is the time to get the answers to your application questions. In this course we’ll explore Topic 606 from the perspective of entities that currently recognize revenue under SOP 81-1/ASC 605-35, highlighting how the accounting for revenue recognition changed following the adoption of ASC Topic 606. Next, the course will address challenging sections of the ASC 606 guidance such as identifying performance obligations and when and how you recognize revenue over time.
Applying Topic 606 successfully to your long-term contracts is an ongoing exercise. This course will keep you up to date with the latest guidance and best practices in this critical area.
Major Topics:
- Topic 606’s five-step revenue recognition model
- Determining whether to recognize revenue over time or at a point in time under Topic 606
- Other unique considerations in applying the five-step model for entities currently using SOP 81-1
- Lessons learned and best practices from entities already adopting Topic 606
Learning Objectives
- Identify the five steps of Topic 606’s new revenue recognition model
- Determine the criteria that supports recognizing revenue over time under Topic 606
- Apply Topic 606’s guidance in other areas of interest to entities currently using SOP 81-1
- Recall best practices and lessons learned from others implementing Topic 606
Designed for:
Accounting and auditing practitioners at all levels desiring to understand the challenges in applying Topic 606 to entities with long-term construction projects
Prerequisite:
Experience in accounting and auditing
Advanced Preparation:
None