The new converged revenue recognition standard from the Financial Accounting Standards Board and the International Accounting Standards Board could have an impact on not only financial statement preparers, but on tax practitioners and auditors as well.
“It’s not just accountants who need to worry about this,” said Bloomberg BNA Tax & Accounting executive editor George Farrah in an interview Friday. “Tax people will need to know about it because you might have to change your accounting method for tax purposes, and you need to assess whether or not that’s going to have an impact. They also need to be aware of it for their transfer pricing policies. Their transfer pricing may have been based on revenue estimates. Those estimates need to be looked at to see if there is any impact on them.”
Farrah also pointed to requirements in the Securities and Exchange Commission’s Staff Accounting Bulletin 74 for disclosing the impact that recently issued accounting standards will have on the financial statements of a company when adopted in a future period.
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Source: Michael Cohn (www.accountingtoday.com)
