The International Accounting Standards Board (IASB) and the Financial Accounting Standards Board (FASB) plan to set up a joint resource group to help with the transition to the final converged standard on revenue recognition, which is due to be issued later this year.
The group will be made up of 10 to 15 specialists representing financial statement preparers, auditors, regulators, users, and other stakeholders as well as members of the IASB and FASB, with details of the membership announced after the final standard is issued.
They will be responsible for informing the IASB and the FASB about interpretive issues that could arise when companies, institutions, and other organisations implement the revenue recognition standard. The transition group will have a limited life, with most of its work finishing when the standard takes effect in 2017.
During that time, it will analyse and review stakeholder issues applying to common transactions that could reasonably create diversity in practice. As well as providing a public forum to discuss the application of the requirements, the group will provide feedback to help the boards decide on what action, if any, is needed to resolve any difficulties identified, but it will not itself issue guidance.
Hans Hoogervorst, chairman of the IASB said: 'Revenue is a key performance indicator and is important to every business. Our joint transition group will help to ensure that stakeholders are reading the words in the new revenue standard in the way that we intend that they be read.'
The decision to create a joint transition resource group comes after disagreements between the two boards at the end of last year, which included concerns over the slow pace of the US approach to adopting IFRS and differing opinions over the standards for credit losses in their financial instruments convergence project.
Russell Golden, chairman of the FASB, said: 'Effective implementation of the revenue recognition standard is critical to its success in providing financial statement users with the information they need to make the right decisions about how to allocate their capital. The boards are committed to ensuring a smooth transition to the new standard, and the transition resource group is an important tool for determining any areas that will need additional guidance before the standard becomes effective in 2017.'
Guidelines for submitting issues will be posted to the boards' respective websites after issuance of the final standard.
