In June 2020, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2020-05 –
Revenue from Contracts with Customers
(Topic 606) and
Leases
(Topic 842) –
Effective Dates for Certain Entities
. Amendments in these updates were made by the FASB to provide relief to certain entities and impacts the adoption of the following significant accounting standards:
- ASU No. 2014-09 – Revenue from Contracts with Customers (Topic 606) – Amendments in this update defer the adoption date of Topic 606 for one year for franchisors that are not public business entities and all private and not-for-profit (NFP) entities, which have not yet adopted Accounting Standard Codification (ASC) Topic 606. The effective date of ASC Topic 606 will be for annual reporting periods beginning after December 31, 2019, and interim reporting periods within annual reporting periods beginning after December 15, 2020.
- ASU No. 2016-02 – Leases (Topic 842) – Amendments in this update defer the adoption date of Topic 842 by one year for public NFP entities that have not yet adopted ASC Topic 842 or made their financial statements available for issuance and all private and NFP entities. For those entities the effective date will be fiscal years beginning after December 15, 2019, including interim periods within those fiscal years.
For each of these standards, the impacted entities may elect the original effective dates. For additional information about these deferrals affirmed by the FASB or any other accounting consultation or implementation items, please email
info@actcpas.com
, or contact your ACT representative.
