More than 10 months after issuing Staff Accounting Bulletin No. 101 (SAB 101), the Securities and Exchange Commission has trotted out its long-awaited Frequently Asked Questions (FAQs) and Answers.
SAB 101 was issued back on Dec. 3 to address the principles of revenue recognition. At that time, there was some confusion over how different industries would define and treat revenue and such critical events such as “delivery” of goods and services.
As a result, implementation of SAB 101, originally scheduled for March 31, or the end of the first quarter, was postponed at least twice.
On Monday, the SEC finally took one major step closer to implementation when it issued its 31 FAQs. “One of the goals of SAB 101 is to summarize in one location the existing guidance on revenue recognition and make that guidance more accessible to registrants and their auditors,” according to the SEC’s release.
The staff has deferred the implementation date of SAB 101 until no later than the fourth quarter of fiscal years beginning after December 15, 1999.