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2023 Life Sciences Industry Accounting Guide

Insights and guidance on life sciences accounting issues

Accounting in life sciences is ever-evolving, with new challenges surfacing and business priorities shifting every day. Deloitte’s 2023 Life Sciences Industry Accounting Guide can help accounting teams address the unique set of issues they face.

Life sciences accounting: Answers to today’s pressing questions

Finance and accounting professionals in the life sciences industry face complex issues specific to their organization’s needs and priorities. Accounting teams must exercise significant judgment in applying existing rules to matters related to revenue recognition, research and development, acquisitions, financial instruments, and contingencies, among others.

The 2023 edition of Deloitte’s Life Sciences Industry Accounting Guide is here to help bring clarity. As an accounting manual for pharmaceutical companies and others in the life sciences industry, professionals can use the guide throughout the year to address established accounting or reporting issues like these and others. They can also learn how to handle new trends in the industry like environmental, social, and governance (ESG) reporting and the potential financial reporting impact of the Inflation Reduction Act (IRA).

Download the full life sciences guide or explore the highlights and downloads for individual sections below.

Download the individual sections

Macroeconomic and Geopolitical considerations

The current environment continues to present unique life sciences accounting challenges.

Environmental, social, and governance (ESG)

ESG initiatives are top of mind for many firms, and the reporting implications are significant.

Revenue recognition

Life sciences accounting teams should understand the accounting consequences for complex revenue arrangements.

Research and development (R&D)

As R&D arrangements become more complex, so do the accounting requirements.

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Acquisitions and divestitures

With varying outcomes possible, interpreting M&A accounting guidance is vital.

Consolidation

Carefully analyzing third-party arrangements is a prerequisite to consolidation conclusions.

Contingencies

Accounting for uncertainties can be complex.

Statement of cash flows

Cash flow accounting challenges are a leading cause of restatements and SEC comments.

Download the individual sections

Income taxes

Looking for targeted ASC 740 considerations that are most relevant to life sciences?

Compensation

Compensation arrangements feature complexities with financial statement implications.

Financial instruments

External financing transactions include terms and conditions that require careful accounting analysis.

Leases

Leasing transactions are common, but the accounting impacts for the life sciences industry are unique.

Download the individual sections

Initial public offerings

IPO and SPAC activity may be lower, but accurate financial reporting for the life sciences industry is as important as ever.

Other topics

We briefly address a range of other life sciences accounting subjects.

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This document contains general information only and Deloitte is not, by means of this document, rendering accounting, business, financial, investment, legal, tax, or other professional advice or services. This document is not a substitute for such professional advice or services, nor should it be used as a basis for any decision or action that may affect your business. Before making any decision or taking any action that may affect your business, you should consult a qualified professional advisor. Deloitte shall not be responsible for any loss sustained by any person who relies on this document.

About Deloitte
As used in this document, “Deloitte” means Deloitte & Touche LLP, a subsidiary of Deloitte LLP. Please see www.deloitte.com/us/about for a detailed description of our legal structure. Certain services may not be available to attest clients under the rules and regulations of public accounting.

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