Revenue Recognition Essay

2. Gilmore whistleblowing in the given situation lends itself to much ethical debate. For this discussion, one should assume SCE is in violation of the AICPA Code of Professional Conduct by recognizing revenue in the current period as detailed in the previous issue. To first consider the ethics of Gilmore whistleblowing, it is essential to define the steps that should be taken by her before she considers whistleblowing. For this, one can use the standard on ethical conflicts outlined in the AICPA

pricing), sales and distribution (order and contract), and finance (revenue recognition). The impacted functional areas in the Company are sales, accounting, customer care, system operations, and engineering. Scope, Budget, Timeline and Resources The objective of the project is to deliver an improved solution within the current environment. To include enhanced functionality for the business including a robust revenue recognition module, enhanced contract features, and a well-developed interface

Revenue Recognition Changes Caused Fraud There were 347 alleged cases of fraud involving public company according to Fraudulent Financial Reporting: 1998-2007 sponsored by Committee of Sponsoring Organizations of the Treadway Commission (COSO, 2010) that were investigated by Securities and Exchange Commission (SEC) on May 2010, which is showing 53 increased in the number of fraud when compared to the 1987-1997 study (p.5). COSO’s result is a sad number in a 10 year period, which averaging close to

Introduction The following research paper is about the new joint revenue recognition principles that were unveiled by the Financial Accounting Standards Board (FASB) and the International Accounting Standards Board (IASB), which standardizes generally accepted accounting principles (GAAP) and international financial reporting standards (IFRS) on recognition of revenue in the United States. The new joint revenue recognition principle was created to increase the financial transparency and the comparability

generate substantial profits through their call revenue (initial term and renewal periods), and the up-front costs incurred are a necessary investment in the contract. Based on customer lifting studies performed by an outside consultant and other industry statistics, OSI expects its contract with Company X to extend beyond the initial contract term and estimates a customer life of approximately 4.5 years. The total fees (set-up fee and call revenue) over the customer life are expected to exceed the

Introduction Before May 2014, FASB defines that revenues and gains generally are not recognized until it realized or realizable. Such as, when the sale has been completed or service has been provided, revenue can be realized. Besides broad standard, U.S.GAAP revenue recognition guidance has numerous particular revenue requirements for industries or transactions, which sometimes result in different numbers for economically similar transactions. To remove inconsistencies, in May 2014, FASB issued

1: Title of the current project Project name: Revenue Recognition This project is jointly conducted by Financial Accounting Standards Board (FASB) and the International Accounting Standards Board (IASB). Part 2: The reasons why the current project was added to the work programme of the accounting standard-setting body Revenue is playing a crucial role in the financial statements in assessing a company’s performance. However, revenue recognition requirements in International Financial Reporting

Collectability of revenues must be explicitly assessed in a contract before applying the revenue recognition model. An entity must take into account the credit risks and probability of revenue collection as the amount of consideration for the transfer of goods or services based on the customer’s capacity and intention to make due payments. This is one essential difference from the previous standards (Wilson and Sobolewski). The five-step model of revenue recognition, as instated in FASB ASC 606-10-05-4

determine the amount of revenue to be recognized. Relative fair value method VSOE % of relative fair value Allocated discount Allocated arrangement consideration System $12,000 85.71% $1,714 $10,286* PCS $2,000 14.29% $286 $1,714 Total $14,000 $2,000 $12,000 February 1, 2012 To record the payment received: Cash $12,000 Unearned Revenue $12,000 April 30, 2012 To record the delivery of Volcano System: Unearned Revenue $10,286* Revenue

The Revenue Recognition Principle: Its Significance and Application According to Kimmel, Kieso and Waygandt (2011), "the revenue recognition principle requires that companies recognize revenue in the accounting period in which it is earned." Basically, this means that revenues should be recognized (or in other words recorded) on completion of the process of revenue generation i.e. once revenue has been earned. This is as per the accrual basis of accounting. Essentially, revenue recognition derives