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2022 Life Sciences Industry Accounting Guide

Insights and guidance on life sciences accounting issues

Accounting in life sciences is ever-evolving, with new challenges surfacing as new business priorities take hold. No matter where a company finds itself today, Deloitte’s 2022 Life Sciences Industry Accounting Guide can help its accounting team address the unique set of issues it faces.

Life sciences accounting: Answers to today’s pressing questions

Finance and accounting professionals in the life sciences industry face a range of complex issues specific to their organization’s needs and priorities. For each one, accounting teams must exercise significant judgment in applying existing rules. It can seem daunting.

Deloitte’s 2022 Life Sciences Industry Accounting Guide is here to help bring clarity. An accounting manual for pharmaceutical and biotech companies and others in the life sciences industry, professionals can use the guide throughout the year to address established accounting or reporting issues like revenue recognition, research and development, acquisitions and divestitures, contingencies, and income taxes. They can also learn how to handle new trends in the industry like the reporting consequences of environmental, social, and governance (ESG) strategies and initial public offerings (IPOs).

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

Download the individual sections

COVID-19 considerations

Pervasive and challenging financial reporting considerations apply to the life sciences industry.

Environmental, social, and governance (ESG)

ESG initiatives are top of mind for many life sciences organizations, and the accounting implications can be significant.

Revenue recognition

Life sciences accounting teams navigate complex healthcare markets to apply the accounting model for revenue.

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, applying M&A accounting guidance is vital.

Consolidation

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

Contingencies

Accounting for product liability issues, patent litigation, compliance matters, and other contingencies involves uncertainty.

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 income tax 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

Is an arrangement a lease? Need to recognize one on your balance sheet?

Download the individual sections

Initial public offerings

With increasing IPO and SPAC transactions in life sciences, accounting is 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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