Alert: FASB Accounting Standards Updated 2020-05 Revenue from Contracts with Customers and Leases: Effective Dates for Certain Entities

Category: US GAAP

Alert: FASB Accounting Standards Updated 2020-05 Revenue from Contracts with Customers and Leases: Effective Dates for Certain Entities

On June 3, 2020, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2020-05 Revenues from Contracts with Customers (Topic 606) and Leases (Topic 842): Effective Dates for Certain Entities.

This ASU defers the effective dates of the following ASUs (including subsequent amendments to these ASUs) to provide relief to help ease the implementation challenges faced by certain entities due to the COVID-19 pandemic:

Early application continues to be permitted for all theses ASUs. The following table outlines the resulting changes in effective dates:

Amended Effective Dates[1] as a Result of ASU 2020-05
Impacted ASU Public Business Entities (including not-for-profit conduit bond obligors or employee benefit plans that file with or furnish financial statements to the SEC) All Other Entities
ASU No. 2014-09 Revenue from Contracts with Customers (Topic 606) As issued December 15, 2016 December 15, 2017 and interim periods within fiscal years beginning after December 15, 2018
Revised December 15, 2017 December 15, 2019 and interim periods within fiscal years beginning after December 15, 2020
ASU No. 2015-14 Revenue from Contracts with Customers (Topic 606) As issued December 15, 2017 December 15, 2018 and interim periods within fiscal years beginning after December 15, 2019
Revised No change December 15, 2019 and interim periods within fiscal years beginning after December 15, 2020
ASU 2016-02 Leases (Topic 842) As issued December 15, 2018 December 15, 2019 and interim periods within fiscal years beginning after December 15, 2020
Revised December 15, 2019 (only for Not-for-Profit Conduit Bond Obligors) December 15, 2021 and interim periods within fiscal years beginning after December 15, 2022
ASU No. 2019-10 Financial Instruments – Credit Losses (Topic 326), Derivatives and Hedging (Topic 815), and Leases (Topic 842) As Issued December 15, 2018 December 15, 2020 and interim periods within fiscal years beginning after December 15, 2021
Revised December 15, 2019 (only for Not-for-Profit Conduit Bond Obligors) December 15, 2021 and interim periods within fiscal years beginning after December 15, 2022

[1] Effective dates are for fiscal years beginning after dates stated within the table and include interim periods therein, unless otherwise specified. 

To access the full script of ASU No. 2020-05, click here.

 

This communication contains a general overview of the topic and is current as of July 24, 2020. The application of the principles addressed will depend upon the particular facts and circumstances of each individual case. Accordingly, this publication is not a substitute for professional advice and we recommend that any decisions you take about the application or not of any of the information presented be made in consultation with a qualified professional, who can address any variance that may be required to reflect your circumstances. Please contact your local MNP representative for customized assistance with the application of this material. MNP LLP accepts no responsibility or liability for any loss related to any person’s use of or reliance upon this material. © MNP LLP 2020. All rights reserved.

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Michelle Balmer

Michelle Balmer CPA, CA

Vice President, Assurance

Michelle Balmer, CPA, CA, is a Senior Assurance Services Partner with MNP. With 14 years of experience in public practice, Michelle helps a broad range of public and privately held companies in a variety of industries. She also works on special projects, including costing studies, benchmarking and best-practice studies, operational analyses, litigation support and due diligence.

As a key member of MNP's Assurance team, Michelle has played an instrumental role in assurance policy development, implementing accounting and assurance standards firm-wide and educating assurance practitioners regarding methodologies and new pronouncements. She also provides technical advice and consultation on accounting and assurance issues, as well as on rules of professional conduct issues, to all MNP practitioners.

Michelle was certified a Chartered Accountant (CA) after obtaining a Bachelor of Commerce degree from the University of Alberta. She has been actively involved with the Institute of Chartered Accountants of Alberta, including the Chartered Accountants School of Business, in an instructional and marketing capacity. An avid volunteer, she has assisted numerous groups such as the Easter Seals of Alberta, Paralympic Sports Association and Junior Achievement of Northern Alberta.