FASB Delays – Dennis Gardiner, Managing Partner, CPA
On May 20, 2020, the FASB decided to extend the effective date of Topics 606, Revenue from Contracts with Customers (Revenue Recognition), and 842, Leases, for certain entities and has directed the staff to draft a final Accounting Standards Update (ASU) for vote.
FASB decided to amend the effective date of Revenue Recognition (Topic 606) for all nonpublic entities that have not yet adopted the new standard. FASB extended the relief to all nonpublic entities based on feedback on the proposal. The effective date for the new revenue recognition standard will be extended to annual reporting periods beginning after December 15, 2019. Early application will continue to be permitted.
FASB retained the effective date of ASU No. 2018-08, Not-for-Profit Entities (Topic 958): Clarifying the Scope and the Accounting Guidance for Contributions Received and Contributions Made.
FASB extended the effective date of the Lease Accounting Standard for private companies and private not-for-profit entities. The effective date for Leases (Topic 842) will now be for fiscal years beginning after December 15, 2021 and interim periods within fiscal years beginning after December 15, 2022. Early application will continue to be permitted.
These standards are going to go into effect eventually– I promise. If you find that you are retiring before you have to face them at your company, kudos to you. Otherwise, we will want to continue visiting with you about implementation, requirements and consequences.