On May 28, 2014, the Financial Accounting Standards Board (FASB) and International Accounting Standards Board (IASB) issued converged guidance on recognizing revenue in contracts with customers (ASC 606). The objective of the guidance is to establish principles to report useful information to users of financial statements about the nature, amount, timing and uncertainty of revenue from contracts with customers. The new guidance provides several benefits to financial statement users. Entities applying the new standard for contract revenue recognition will follow five steps:
• Identify the contract with the customer
• Identify performance obligations
• Determine transaction price
• Allocate transaction price to performance obligations
• Recognize revenue when each performance obligation is satisfied
Although these steps may seem simplistic at the surface, within each step are multiple components and considerations users must be aware of. This course will delve into the many concepts involved in Step One: Identifying the contract.
The course utilizes many examples from numerous industries to enhance learning of the various concepts.
Publication Date: December 2023
Designed For
Accountants and Finance professionals, Internal auditors/Professionals considering the role of internal audit, and Legal and Compliance professionals.
Topics Covered
- Explore the distinction between revenue and income
- Recognize how elements of the updated revenue recognition standard differs from the previous standard
- Components that should be considered in the identification of a contract including approval and commitment, identification of rights, identification of payment terms, commercial substance and collectability
- Overview of Contract Modifications
Learning Objectives
- Recognize how elements of the new revenue recognition standard differ from the previous standard
- Identify various criteria in the step "Identify the Contract" including; approval/commitment of parties, identification of rights of parties, payment terms can be identified, the contract has commercial substance, and collection is probable
- Identify when a contract modification requires a new contract or can be combined with the original contract
- Identify accounting for non-contract modifications
- Identify accounting for contract modifications
Level
Basic
Instructional Method
Self-Study
NASBA Field of Study
Accounting (2 hours)
Program Prerequisites
None
Advance Preparation
None
Instructor
Lynn Fountain
Lynn Fountain has over 38 years of experience spanning public accounting, corporate accounting and consulting. 20 years of her experience has been working in the areas of internal and external auditing and risk management. She is a subject matter expert in multiple fields including internal audit, ethics, fraud evaluations, Sarbanes-Oxley, enterprise risk management, governance, financial management and compliance. Lynn has held two Chief Audit Executive (CAE) positions for international companies. In one of her roles as CAE, she assisted in the investigation of a multi-million-dollar fraud scheme perpetrated by a vendor that spanned 7 years and implicated 20 employees. The fraud was formally investigation by the FBI and resulted in 5 indictments estimating a $13M fraud loss.
Ms. Fountain is currently engaged in her own consulting and training practice. She is a highly sought-after trainer and international speaker. In addition, Ms. Fountain has assisted numerous companies with enterprise risk management frameworks, internal audit processes and financial accounting. She also serves as a discussion leader for the AICPA for numerous classes finance, accounting and risk management topics.
Ms. Fountain is the author of three separate technical books. Her first book released in 2015 by the Institute of Internal Auditors Foundation is entitled “Raise the Red Flag – The Internal Auditors Guide to Fraud Evaluations”. Her second book “Leading the Internal Audit Function” was released in October 2015 by Taylor & Francis Publications. This book serves as the initial launch for a series of leading practice internal audit and information technology publications. Her third book “Ethics and the Internal Auditor’s Dilemma” was released in December 2016.
Ms. Fountain obtained her BSBA from Pittsburg State University and her MBA from Washburn University in Kansas. She has her CPA, CGMA, CRMA credentials.