Implementing the new revenue standard — How do your disclosures stack up?

This Heads Up discusses observations from our review of SAB 74 disclosures that Fortune 1000 companies included in periodic SEC filings regarding their adoption of the FASB’s new revenue standard.

This is a preview of the Heads Up. View the complete Heads Up.


As the effective date of the FASB’s new revenue standard approaches, there has been an increased focus on companies’ progress toward implementing its requirements. Some of our recent publications have discussed such focus. For example, our September 22, 2016, Financial Reporting Alert, outlines reminders from the SEC about best practices for registrants to follow in the periods leading up to the standard’s adoption, including remarks about SAB Topic 11.M disclosures (or “SAB 74 disclosures”). Further, in our April 4, 2017, Heads Up, we discuss the results of an informal Deloitte survey on implementing the new standard. 

To gain additional insight into the implementation status of public companies, particularly regarding the types of disclosures they have provided about adopting the standard, we recently completed a review of the SAB 74 disclosures that the Fortune 1000 public companies have included in their periodic filings with the SEC. This Heads Up discusses certain observations from our review of those disclosures. 

Volume 24, Issue 15 | June 5, 2017

General Observations

At the September 22, 2016, meeting of the FASB’s Emerging Issues Task Force, SEC Assistant Deputy Chief Accountant Jenifer Minke-Girard made an announcement (the “SEC staff announcement”) regarding SAB 74 disclosures. Ms. Minke-Girard indicated that if a registrant is unable to reasonably estimate the impact of adopting the new revenue standard, the registrant should consider providing additional qualitative disclosures about the significance of the impact on its financial statements. She further noted that the SEC staff would expect such disclosures to include a description of:

  • The effect of any accounting policies that the registrant expects to select upon adopting the new revenue standard.
  • How such policies may differ from the registrant’s current policies.
  • The status of the registrant’s implementation process and the nature of any significant implementation matters that have not yet been addressed.

Overall, we have observed that the amount of qualitative and quantitative information disclosed in response to the SEC staff announcement has varied; however, most registrants have expanded their qualitative discussions of implementation efforts. For instance, while a majority of registrants have provided some information about the status of their adoption beyond merely stating that they “are currently evaluating the impact,” very few have quantified the impact of adoption. In addition, only a small number of registrants have indicated that they have early adopted the standard. 

View the rest of the Heads Up.

Subscribe and Archives

Subscribe to receive Heads Up via e-mail. Archives are available on the US GAAP Plus site.

Heads Up newsletters, published as warranted, analyze important accounting developments, such as new FASB and IASB pronouncements or exposure drafts. Concise examples and answers to frequently asked questions assist readers in understanding and implementing the critical guidance.

Did you find this useful?