SEC Flash Report - October 2017

October 2017

SEC Issues Updates to Reflect New Revenue Recognition Standard

On August 18, 2017, the SEC staff released Staff Accounting Bulletin (SAB) No. 116 to conform its staff guidance on revenue recognition with Accounting Standards Codification (ASC) Topic 606, Revenue from Contracts with Customers. SAB No. 116 states that SAB Topic 13, Revenue Recognition, and SAB Topic 8, Retail Companies, are no longer applicable once a registrant adopts ASC Topic 606. It also modifies Section A, Operating-Differential Subsidies of SAB Topic 11, Miscellaneous Disclosure, to clarify that revenues from operating-differential subsidies[1] presented under a revenue caption should be presented separately from revenue from contracts with customers accounted for under ASC Topic 606 or as a credit in the costs and expenses section of the statement of comprehensive income. Prior to adoption of ASC Topic 606, registrants should continue to refer to prior SEC guidance on revenue recognition topics.

The SEC also issued two releases to update its interpretive guidance on revenue recognition:  


For questions related to matters discussed above, please contact:
 
Jeff Jaramillo
National Partner
  Jin Koo
National Assurance Partner

 
Adam Brown
National Director of Acounting
   
 
[1] Revenues representing operating-differential subsidies under the Merchant Marine Act of 1936, as amended. Operating-differential subsidy is a payment made by the federal government to the owner-operator of a qualified American flag vessel to cover certain costs.