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Revenue Recognition and Lease Standards Deferrals

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On June 3, 2020, the FASB officially issued ASU 2020-05, Revenue from Contracts with Customers (Topic 606) and Leases (Topic 842). The FASB issued this ASU to allow certain companies and organizations that have not yet applied the revenue recognition and leases guidance to delay their implementation by one year.

The ASU permits private companies and not-for-profit organizations that have not yet applied the revenue recognition standard as of June 3, 2020 to do so for annual reporting periods beginning after December 15, 2019.

For leases, the ASU provides an effective date deferral to private companies and private not-for-profit organizations that have not yet made available their financial statement and public not-for-profit organizations that have not yet issued their financial statements as of June 3, 2020 reflecting the adoption of the guidance. The ASU is intended to provide near-term relief for certain entities for whom the leases adoption is imminent.

Under the ASU, private companies and private not-for-profit organizations may apply the new leases standard for fiscal years beginning after December 15, 2021. Public not-for-profit organizations that have not yet issued financial statements reflecting the adoption of the lease guidance as of June 3, 2020, may apply the standard for fiscal years beginning after December 15, 2019.

For the lease and revenue recognition standards, early adoption is permitted.

Frank Jakosz

Frank serves as Partner and Quality Assurance Director and has more than 45 years of public accounting and nonprofit expertise. He has a deep understanding of nonprofit organizational best practice financial functions and operations, and his expertise includes financial reporting and analysis, investments, internal controls, endowments, and grants management. As the firm’s Quality Assurance Director, Frank provides oversight to all functions of internal quality assurance, including continuing professional education, systems and processes, and monitoring and implementing new technical standards.

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