Yesterday, private companies that have not issued their financial statements for periods beginning after December 31, 2018 received some welcome relief from the Financial Standards Accounting Board (FASB).
On Wednesday, May 20, FASB voted to delay the effective date of the revenue recognition standard (ASU 606 Revenue from Contracts with Customers) for nonpublic entities that have not yet issued their financial statements. The effective date of ASU 606 for these entities has been deferred to periods beginning after December 31, 2019. It is expected that the final ASU will give these entities the option of adopting the new standard on the current implementation date, or deferring implementation for one year.
FASB originally planned to delay the effective date only for non-public franchise entities. However, given the overwhelming impact of COVID-19 on businesses, FASB decided to broaden its extension to include all nonpublic entities.
FASB will now draft a formal Accounting Standards Update (ASU) to describe the delay, and its board members have indicated they will vote in favor of it.
If you have any questions about implementing the revenue recognition standard or any other matters, please contact your Kreischer Miller relationship professional or any member of our team.
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