Case Studies in the New Recognition Guidance
For many years,
FASB and the IASB sought to overhaul the guidance on revenue
recognition, replacing industry specific conventions with
a common, universal approach focusing on contractual arrangements.
The result, Accounting Standards Update (ASU) 2014-09, focuses
on the satisfaction of contractual obligations in order
for revenue to be recognized.
As CPAs face increased
professional scrutiny in an ever more litigious society,
it has become clear that firms must take a proactive approach
in protecting themselves. Statistics generally suggest that
claims against CPAs have not only risen in number and severity,
but are expanding into uncharted territory as technology
poses new risks for data security.
How to Avoid or Minimize
Fraud cuts a wide swath across businesses and other organizations. The typical organization loses 5% of revenue each year to fraud, according estimates from the most recent Report to the Nations, a survey produced by the Association of Certified Fraud Examiners (ACFE 2014). When
applied to the 2013 estimated gross world product, this revenue
loss translates to a global figure of nearly $3.7 trillion.