The new model for how businesses across all industries will need to recognize revenue from customer contracts in 2018 for public companies and in 2019 for nonpublic companies is a game changer. While privately held companies have an additional year to come into compliance, they must begin preparations now to account for the substantial changes in the timing and amount of income and expenses they will report on an annual basis in the future. Moreover, adopting the new standard will bring with it significant complexities that will impact virtually all areas of a business’s operations, including contracting, sales, lending and financing, information technology, policies and procedures, and financial reporting.
Unlike the current requirements under the U.S. Generally Accepted Accounting Principles (GAAP), the Accounting Standards Update (ASU) No. 2014-09 provides businesses in all industries and all jurisdictions with one singular and consistent five-step model for recognizing and reporting the “nature, amount, timing, and uncertainty of revenue and cash flows arising from a contract with a customer.” More specifically, the new model represents a shift from more rules-based accounting standards toward one that will require businesses to assess the unique facts and circumstances of each customer contract and exercise significant judgment when determining the amount and timing of revenue recognition. This will be especially difficult for businesses in the real estate and construction industries to navigate and may lead to devastating consequences if they do not apply judgment in a manner that is consistent with the new model.
Step One: Identify the Contract with a Customer
Under the new regulations, a contract will exist when there is an agreement between and approved by two or more parties that creates and specifically identifies both 1) the enforceable rights to goods and services and 2) the related payment terms, including transaction price, which an entity can expect to collect in exchange for delivering those goods and service. While this definition appears simple and precise, it is important for businesses to understand that there are nuances to a contract that could create a separate and distinct contract or significantly modify the terms of an existing contract.
For example, in the world of real estate, a change order can, in some instances, create a new, separate contract. Similarly, the collectability factor of a real estate contract can be a complicated judgment call, especially when an entity offers pricing concessions or seller-provided financing to the customer.
Should it be determined that a contract does not exist based on the new revenue recognition standard, an entity will need to report all payments it received as liabilities until the point in time when all parties meet their contractual obligations.
With these concerns in mind, it is critical that real estate businesses engage the services of experienced legal counsel to properly draft contract agreements that meet the requirements of the new regulations and to explain how the new standards will affect when and how they recognize revenue. This will not only impact a business’s bottom line and create disparities between similar real estate companies, it will also have significant influence over a business’s loan covenants and access to capital.
Step 2: Identify the Performance Obligations
Performance obligations are contractual promises to deliver to a customer distinct goods or services or a combination of goods and service. While there are specific rules for defining performance obligations, the key challenge for most businesses will be identifying whether multiple performance obligations are distinct from each another in the context of the contract.
In the real estate industry, a single contract may include multiple performance obligations. For example, a developer building a condominium tower may contract to construct and sell individual units. It may also promise to provide customers with amenities, such as pools and tennis courts, extended warrantied for appliances and building maintenance and/or management services. In this example, the developer must first have systems in place to more easily capture and identify all distinct performance obligations and related stand-alone costs that they would need to carve out from their existing sales contracts.
In some instances, businesses may need to bundle together multiple services into one performance obligation. In other situations, goods and services may need to be unbundled into separate obligations. This would undoubtedly alter when the developer may recognize revenue from each good and service it delivers, and it would require the assistance of certified accountants to make an educated judgment and project the actual financial impact these changes would create.
Step 3: Determine the Transaction Price
Determining the transaction price, or the amount that real estate developers can expect as payment in return for transferring goods or services to a customer, requires consideration of following elements: non-cash considerations; pricing discounts, credits, price concessions, returns, or performance bonuses and penalties; the existence of significant financing components; and consideration payable to the customer. Ultimately, each of these factors will impact the final numbers.
In real estate deals, it is not uncommon for a transaction price to be less than a contracted price. This is especially true when there exists a contract concession that affects when and how much revenue a business may account for in the transaction price. Under these circumstances, a business will need to use an appropriate method to estimate at the time of contract the discounts and ultimate transaction price it is entitled to receive at the end of each reporting period. This will require businesses to develop new models for projecting revenue in the future as well as updating their current forecasts. In some instances, recognition of revenue may be accelerated or delayed when compared to current requirements under GAAP.
Step 4: Allocate the Transaction Price to the Performance Obligations in the Contract
To allocate an appropriate transaction price to each performance obligation, a real estate business must first determine at contract inception the stand-alone selling price of each distinct product and service it promises to deliver. For example, the real estate developer building a multi-family apartment project with clubhouse, park and retail facilities, would need to allocate the total contract price to each separate performance obligation (i.e. the multi-family homes, the clubhouse, the park and the retail facilities).
These prices may not be easily recognizable due to volume discounts or bundling. In these instances, businesses will need to develop new processes and procedures for estimating stand-alone selling prices of the goods and services to be delivered.
Step 5: Recognize Revenue When (or As) the Entity Satisfies a Performance Obligation
Under the new standard, real estate businesses will no longer recognize revenue when they transfer the risks and rewards of ownership to a buyer. Rather, they will account for revenue when they fulfill a performance obligation, either at a point in time or over an extended period of time.
Under the ASU, businesses will need to evaluate whether or not they satisfied a performance obligation (and can, therefore, book revenue) based upon 1) the customer’s rights to the benefits provided by the contract, 2) whether or not the businesses created or enhanced an asset that a customer controls, and 3) whether or not the businesses created or customized an asset that only the customer can use and has an enforceable right to payment for performance completed to date.
Applying these methods of measurement for satisfying an obligation that occurs over time further requires businesses to identify the moment at which they transfer control, which may be when the customer accepts the asset and takes significant risks and rewards of ownership, when the customer takes physical possession or legal title to the asset, or when the business has a present right to payment for the asset.
Consider, for example, a property management company with contracts that contain multiple performance obligations that they perform for one contract price. Certain performance obligations, such as property maintenance and repairs, will be delivered over time. Others, such as leasing services, will be performed at one point in time. Under the new standard, the company would be required to allocate the lump sum of its “transaction price” between these separate performance obligations.
Privately held businesses in all industries, including real estate and construction, have a narrow window of opportunity to plan and prepare for the new model of revenue recognition, which will go into effect on Jan. 1, 2019, for annual reporting entities. The first step should be a meeting with legal and tax advisors and accountants to understand how the new standard will ultimately impact an organization’s existing processes, policies, systems, and profits.
About the Author: Robert C. Aldir, CPA, is an associate director of Audit and Attest Services with Berkowitz Pollack Brant, where he provides accounting, auditing and litigation-support counsel to public and privately held companies located throughout the world. He can be reached at the firm’s Miami office at (305) 379-7000 or via email at firstname.lastname@example.org.
Businesses large and small and across virtually all industries face a perfect storm of financial reporting compliance challenges to contend with in the coming months. On the near horizon are the new revenue recognition standards, which go into effect for public companies, employee benefit plans and certain not-for-profit entities beginning after Dec. 15, 2017, and Dec. 15, 2018, for private companies. The new method for recognizing revenue from contracts with customers can be a heavy compliance burden on affected businesses. Among the challenges business will face are significant investments of time, resources and coordination across multiple business functions to review how the new standard will affect their financial reporting in the future and potential requirements to change existing contracts, business policies, practices and technology – all while maintaining normal business operations.
Rather than watching the clock count down and awaiting industry-specific implementation guidance from the American Institute of CPAs (AICPA), businesses should be taking the following steps now to make the eventual transition as smooth and seamless as possible.
Understand the Basics of the New Model of Revenue Recognition
In 2014, the Financial Accounting Standards Board (FASB) and International Accounting Standards Board (IASB) introduced ASU 2014-09 to simplify how businesses in different industries book revenue for similar transactions and ensure that they present their financial results in a manner that is comparable across all industries and capital markets. The new model does away with disparate industry- and transaction-specific financial reporting requirements in favor of a more principles-based approach that businesses in all industries and countries will use in the same consistent manner to report the “nature, amount, timing, and uncertainty of revenue and cash flows arising from a contract with a customer” in the same consistent manner. More specifically, the model requires businesses to take the following five steps:
- Identify each customer contract
- Identify each and every “distinct performance obligation”, or separately identifiable goods and services, they promise to deliver
- Determine the transaction price(s) they “expect to be entitled to” under the terms of the contract
- Allocate the transaction price to each separate and distinct performance obligation
- Recognize revenue when the entity satisfies each separate performance obligation
Ultimately, businesses will need to identify each distinct product and/or service they provide and determine when and for how much they can recognize the proportionate revenue from each individual obligation contained in each separate customer contract. Despite the universal application of the five-step model, businesses will be impacted differently from one company to the next and from one industry to another.
Develop a Team to Spearhead the Process
Do not make the mistake of assuming that the new standard of revenue recognition is merely an accounting or finance issue. Rather, businesses of all sizes should recognize the impact the new rules and how they must recognize revenue in the future will have on all of the people, processes and systems throughout their organizations, including sales, IT, legal, accounting and financial reporting.
Remember, this is a marathon, not a sprint, and it will require significant amounts of time and teamwork to gather and analyze information, assess the impact of the new regulations on their current operations and make needed adjustments. For example, compliance with the new standard may require businesses to change their pricing structures and sales incentives, as well as employee compensation and the IT systems that manage and control these functions.
Assess Contracts with Customers
Gathering and analyzing information related to all of a business’s existing contracts is pivotal to implementing the new regulations. For one, businesses may find that existing contracts based on currently acceptable “persuasive evidence of an arrangement” will not qualify as contracts with customers under the new regime of revenue recognition, which requires that all of the following conditions be met:
· The agreement specifies the legally enforceable rights and responsibilities of both the buyer and the seller, including the payment terms for the transfer of goods and/or services
· Both seller and buyer approve the contract (in writing or orally) and agree to perform their respective contractual obligations
· The agreement has commercial substance, for which both buyer and seller can expect their respective cash flow to change as a result of the transaction
Identify Distinct Promises for Goods and Services
Under the new standard, businesses must determine, within the context of customer contracts, each separate and distinct good or service they promise to transfer to the customer as well as the timing and amount of revenue they may recognize from each individual obligation contained in the contract. More specifically, the regulations define “distinct” goods and services as those in which
1. the customer can benefit from the good or service either on its own or together with other resources that are readily available to the customer or
2. The entity’s promise to transfer the good or service to the customer is separately identifiable from other promises in the contract
In other words, businesses must determine whether they promise to transfer each good or service individually or as combined goods and services. For example, a business may integrate and bundle together multiple promises for goods or services (inputs) to deliver to the customer one combined output. Similarly, multiple goods or services may be interdependent or interrelated with each other, such is the case with software and subsequent updates, for which two or more goods or services may be combined into one promise to transfer goods and services. In some situations, a business may find that contract components that they previously bundled together should be identified separately under the new regulations.
Yet, there are times when a contract with a customer may include “implied” promises to transfer goods or services that are not explicitly identified in a contract as separate performance obligations. Rather one or more phases, elements or units of a performance obligation may be bundled together into one combined output(s). For example, if a business performs shipping and handling services to fulfill its obligation to transfer ownership of a product to a customer, those activities will not be considered separate performance obligations that would otherwise require additional contracts. Therefore, the seller may recognize revenue from the sale of a product at the time that it ships the good to the customer. Conversely, if a seller, under its normal business practices, has a history of reimbursing customers for goods that have been lost or damaged in transit, it may consider this coverage of risk to be a separate services for which revenue may be recognized only after the customer physically receives and accepts the product.
Generally, the following factors will indicate that two or more promises to transfer goods or services to a customer are not separately identifiable:
1. The entity provides a significant service of integrating the good goods or services with other goods or services promised in the contract.
2. One or more of the goods or services significantly modifies or customizes, or are significantly modified or customized by, one or more of the other goods or services promised in the contract.
3. Each of the goods or services are highly interdependent or highly interrelated in ensuring the seller can fulfill its promise to transfer each of the goods or services independently.
Know When to Recognize Revenue
In order for a business to recognize revenue from performing a particular performance obligation, the following criteria must be met:
· The seller transfers title and delivers the product or services to the customer, who accepts the goods and services along with the risks and rewards of ownership
· It is probable that the seller will receive payment for the transaction
· The “amount of revenue can be measured reliably”
· The seller substantially completes or fulfills the terms specified in the arrangement with only inconsequential obligations remaining.
Businesses will need to consider a myriad of issues that can affect these requirement, including, but not limited to, the definition of title transfer, customer acceptance and substantial completion of contract terms; the effect of undeliverable products, customers’ rights of return and refunds on their recognition of revenue; and sales involving “multiple element arrangements” for which the new method for recognizing revenue may need to be applied to each distinct obligation separately.
Consider Non-Revenue Impact
Depending upon the industries in which businesses operate, the new standard for recognizing revenue from customer contracts could have significant impact on their non-revenue financial reporting.
For example, product-service warranties that businesses offer customers will need to be treated under the new regulations as separate performance obligations for which revenue allocation will change from current practices. In addition, businesses may be required under the new standard to capitalize and defer recognition of certain costs that they currently expense and record in the current year. This may allow businesses to depreciate or amortize over time the costs they incur for direct labor and materials, bids, sales commissions and subcontractors.
Similarly, the new standard will change the way in which businesses treat sales of non-financial assets, such as real estate, property, plant and equipment, outside of their normal and customary business activities. The timing and measurement of the gains and losses from these sales, which businesses will recognize separately on their financial statements, may be different from current practices.
When considering the impact that the new regulations will have on the recognition of revenue it is reasonable to assume that it will also affect the timing and amount of taxable income the business will report. As a result, businesses should begin thinking now about potential revisions they will need to make to pricing arrangements and all internal controls related to income tax accounting.
This assessment of customer contracts and different performance obligations can be a daunting challenge, especially for small to mid-size businesses that do not have in place the appropriate systems required to analyze and dissect this information. The same is true for bigger businesses with very large numbers of customer contracts and sources of revenue, some of which may be combinations of bundled products and services, including discounts, licensing fees, interest and dividends, royalties and rent.
The advisors and accountants with Berkowitz Pollack Brant work with businesses across all industries to develop and implement strategies that meet ever-changing financial reporting and disclosure requirements.
About the Author: Christopher Cichoski, CPA, is a senior manager in the Audit and Attest Services practice with Berkowitz Pollack Brant, where works closely with business clients in the real estate and construction industries as well as with non-profit organizations. He can be reached at the Miami CPA firm’s office at (305) 379-7000 or via email at email@example.com.
Time is ticking away for businesses with operating leases to comply with new lease accounting standards that were issued a little more than a year ago by the Financial Accounting Standards Board (FASB). While the deadlines for public and private companies to implement the new rules is at least a year away, significant time and efforts will be required for most businesses to come into full compliance.
At the core of the new lease accounting standard is the way in which businesses account for and record on their balance sheets all assets and liabilities related to operating leases with terms greater than 12 months. Specifically, lessees will be required to disclose details concerning operating-lease transactions, including information about variable lease payments and options to renew and terminate leases. In addition, lessees will be permitted to make accounting-policy elections to exclude recognition of assets and liabilities relating to leases with terms of 12 months or less.
Under the current lease rules, businesses do not need to include operating leases on their balance sheets. Rather, they must reference these obligations only as footnotes on financial statements. As a result, businesses’ financial statements often exclude the true value of the entities financial performance, including their assets, credit risk and operating efficiency. Under the new rules, a business’ financial statements will materially reflect all lease transactions and will significantly change the way a business reports to stakeholders its performance, including its cash flow, net income and earnings before interest, tax, depreciation and amortization (EBITDA). Businesses will record a right-of-use asset and the corresponding lease liability on their balance sheets, measured at the present value of the lease payments. Additionally, they will record amortization of the right-of-use asset on their income statements, generally on a straight-line basis over the lease term.
Adapting to the new lease standard will be a time-intensive and perhaps arduous process that will require businesses to track down information about existing leases, project the potential impact they will have on financial reporting in the future, and establish new policies, procedures and systems to monitor lease transactions going forward. Complicating compliance to these new rules is a sea of additional new accounting standards that businesses must implement in the next few years, including, but not limited to, those related to recognizing revenue from contracts with customers, testing for goodwill impairment, measuring credit losses, and classifying cash receipts and cash payments. To ease this heavy burden, businesses must prioritize their efforts and consider the following tips specifically tailored to begin transitioning to the new lease accounting standard.
Six Ways to Prepare for Lease Accounting Rule
- Assemble a Team to Develop a Plan. Rather than diving into the new lease standards head first, businesses should take time to understand what is involved and how the new reporting rules will affect them. One of the best ways to do this is to establish a project management team that includes external and internal accounting and legal professionals, as well as key corporate managers, including those from IT, real estate, transportation and other business units. The ultimate goals of this team approach would be to develop a project transition plan, budget and timeline for implementation, tracking progress and taking steps to address any and all stumbling blocks that may occur along the way.
- Assess the Current Lease Environment and its Impact on Future Lease Reporting. Substantial time and effort may be required for businesses to identify all of their existing leases and the detailed terms and conditions and rights and responsibilities of those agreements. For example, the new standard for lease reporting will require businesses to recognize assets and liabilities for all leases with terms of 12 months or longer; shorter-term leases may avoid reporting requirements if the lessee does not expect to buy the asset(s) in the future. In addition, businesses will have the potentially complicated task of differentiating between reportable operating leases and service contracts, which they are not compelled to recognize on financial statements. In many situations, a business may uncover that an existing contract for real estate, equipment or other property meets the new definition of a lease and must be reflected in its financial reporting under the new guidance or it may recognize that the existing systems it uses to track leases will not suffice in the future. With these discoveries, a business may decide to renegotiate existing leases or forgo leasing altogether in favor of buying assets in the future, or it may decide to invest in a new system for tracking and monitoring leases in the future.
- Assess How the New Lease Standard Will Affect How the Business Communicates its Financial Performance. Because the new standard will represent the first time that many businesses will recognize operating leases on their balance sheets, the amount of lease assets and liabilities, cash flow and balance sheet ratios they report may be different than in prior years. This may present an equally significant difference in how businesses communicate their financial positions and operating efficiencies to investors, lenders and other stakeholders. For example, businesses with large portfolios of leases for office equipment, machinery, airplanes or portfolios of real estate may subsequently report increased amounts of debt owed on their lease obligations. Businesses should consider developing a plan that details how they will communicate these changes to lenders and other stakeholders in advance of the implementation deadline in order to avoid surprises and any adverse reactions.
- Invest in New Systems, Technology and Training to Record and Report Lease Arrangements. Due to the expanded disclosure requirements of the FASB’s new leasing standard, businesses will need more robust systems for capturing and reporting the details of their current and future lease contracts. This is especially true for business that have large portfolios of lease assets, for which software and other technology platforms may be the most efficient option for automating these processes in the future. For some businesses, this may be accomplished by simply working with vendors to update existing software; for others, it may require significant investment in new technology and training.
- Update Policies, Procedures and Internal Controls. Under the new lease reporting standard, businesses will need to differentiate between capital or finance leases and operating leases and report the expenses, cash flow and impact of both types of leases on companies’ assets, liabilities and shareholder equity. This could be a daunting task for businesses with large portfolios of lease assets. Not only will they need to develop new policies for classifying leases, they would also need to establish internal controls for monitoring, updating and analyzing lease data in a timely manner.
- Prepare for Comparative Reporting. The new lease accounting standards require a modified retrospective transition, for which businesses will need to apply the new guidance at the beginning of the comparative year. During the first year of compliance, businesses must provide comparative reporting on financial statements to reflect those operating leases that they previously did not account for on their balance sheets. With this retrospective reporting requirement, businesses will likely present on their financial statements significantly different assets, liabilities, income, cash flow and creditworthiness than in prior years.
Preparing for the new lease accounting rules is a monumental task that will require businesses of all sizes and in all industries to expend significant amounts of time, resources and dollars in advance of the December 15, 2018, deadline for public companies, and December 15, 2019, for privately held entities. By engaging experienced and knowledgeable auditors and accountants in the process, businesses may ease their compliance burdens and come away with new opportunities for improving their internal controls and long-term financial performance.
About the Author: Whitney K. Schiffer, CPA, is a director in the Audit and Attest Services practice of Berkowitz Pollack Brant, where she works with hospitals, health care providers, HMOs and third-party administrators, as well as real estate businesses. She can be reached at the firm’s Miami office at (305) 379-7000 or via email at firstname.lastname@example.org.
The Financial Accounting Standards Board (FASB) recently issued a new standard for financial institutions and other businesses to follow when accounting for credit losses in financial instruments measured at amortized cost, including debt instruments, trade receivables, lease receivables, reinsurance receivables, net investments in leases, financial guarantee contracts and loan commitments. Accounting Standards Update No. 2016-13, Financial Instruments-Credit Losses (Topic 326) will be effective after December 15, 2019, for U.S. Securities and Exchange Commission (SEC) filing public companies and after December 15, 2020, for non-SEC filing public companies. Early application will be permitted for all organizations beginning after December 15, 2018.
Under the newly introduced Current Expected Credit Loss (CECL) model, businesses will no longer rely on an “incurred loss” approach that allows them to delay recognition of credit losses until it is probable that a loss has been incurred. Rather, the CECL model will require entities to recognize as an allowance in current period earnings an estimate of the contractual credit losses they expect to incur over the contractual life of all loans and financial instruments they hold at the reporting date. Making this immediate, forward-looking estimation will further require businesses to consider historical events, current conditions and reasonable forecasts that support the amount they do not expect to collect in the future on loan portfolios and other assets they hold currently. This, in turn, will require enhanced disclosures to provide investors and other users of financial statements with better transparency regarding businesses’ underwriting standards, credit quality, and how they estimate potential losses.
Excluded from the new model are those instruments measured at fair market value and some equity instruments. Similarly, while entities may continue to use existing methods to measure available-for-sale debt securities with unrealized losses, they will no longer be able to recognize those losses as reductions in the amortized cost of the securities.
Transitioning to the new standard for recognizing credit losses will require all reporting entities to assess how they currently account for credit impairments. It will also require changes to businesses’ existing policies, systems and processes to measure credit quality, maintain loss information, forecast future economic conditions and implement new collection estimation techniques. Earlier recognition of allowances for credit losses may result in significant adjustments in credit reserves, for which businesses must begin planning under the guidance of experienced accountants and advisors sooner, rather than later.
The advisors and accountants with Berkowitz Pollack Brant work with individuals and business owners in a broad range of industries and across international borders to develop and implement strategies that meet ever-changing, often complex, financial reporting and disclosure requirements.
About the Author: Robert C. Aldir, CPA, is an associate director of Audit and Attest Services with Berkowitz Pollack Brant, where he provides accounting, auditing and litigation-support counsel to public and privately held companies located throughout the world. He can be reached at the firm’s Miami office at (305) 379-7000 or via email at email@example.com
The Financial Accounting Standards Board (FASB) recently issued an Accounting Standards Update (ASU) that clarifies the definition of a business when used in transactions involving the acquisition, sale or consolidation of a business or assets. More specifically, ASU 2017-1 provides companies and reporting organizations with a narrower, less complex and less costly framework for making the appropriate determination of whether a set of assets and activities qualifies as a business.
The existing definition of a business under Generally Accepted Accounting Principles (GAAP), is “an integrated set of activities and assets that is capable of being conducted and managed for the purpose of providing a return in the form of dividends, lower costs, or other economic benefits directly to investors or other owners, members, or participants.” According to the FASB, this definition is often applied too broadly, resulting in entities erroneously recording transactions as business acquisitions, when they are, in fact, asset acquisitions.
Under the new framework, a business must also include “an integrated set of inputs and processes that create or contribute to the creation of outputs.” Input elements may include intellectual property, employees and long-lived assets. Substantive processes refer to “systems, standards, protocols, conventions, or rules that when applied to inputs, create or has the ability to create or contribute to the creation of an output” that allows an entity to provide goods or services to customers or investment income or other revenue. In this definition, a business requires an input and substantive process but not an output.
Making the determination of whether a set of assets and activities qualifies as a business will require reporting entities to evaluate those inputs and processes through a practical “screen”. If substantially all the fair value of the gross assets acquired or disposed of is focused on a single, identifiable asset or a group of similar identifiable assets, the screen is not met. Therefore, the set is not considered a business and the transaction should be accounted for as an asset acquisition.
This new guidance has a significant impact on the acquisition of income-producing real estate, such as multi-family apartments or shopping centers. Under existing rules, entities frequently accounted for the acquisition of these income properties as a business combination, and the acquisition required them to analyze in-place leases at the acquisition date in order to place a value on this acquired future revenue stream. Subsequently, the entity would amortize the resulting in-place lease intangible over the life of the leases. In many instances, this analysis was time consuming and costly. ASU 2017-1 speaks specifically to in-place leases at the acquisition date and states that such items should be considered part of the value of the acquired asset, more specifically, the building acquired.
As a result of the FASB’s new, narrowed definition of a business, it is possible that an increasing number of entities will account for acquisitions as asset transactions, rather than business acquisitions.
Privately held business entities are required to apply the ASU to annual periods beginning after December 15, 2018, and interim periods within annual periods beginning after December 15, 2019. Public companies must apply the ASU to annual periods beginning after have a December 15, 2017.
The professionals with Berkowitz Pollack Brant’s Audit and Attest Services practice work with businesses of all sizes and across all industry to assess and comply with a sea of evolving regulatory standards.
About the Author: Christopher Cichoski, CPA, is a senior manager with the Audit and Attest Services practice of Berkowitz Pollack Brant, where he provides business consulting services and conducts reviews, compilations and audits for clients in the real estate and construction sectors. He can be reached at the Miami CPA firm’s Ft. Lauderdale, Fla., office at (305) 379-7000 or via email at firstname.lastname@example.org.