606 Case Studies
ASC 606 – Staffing Solutions Company
A staffing solution company is an outsourcing firm which provides services to small, medium and large sized businesses. Typically, the staffing solution company offering may include human resource consulting, safety and risk mitigation services, payroll processing, employer payroll tax filing, workers’ compensation insurance, employers’ practice, and regulatory compliance assistance, workforce management technology, and training and development. The Staffing Solution Company enters into a contractual agreement with its clientele.
As of 2017, industry gross revenues in the United States were estimated to be over US$174 billion annually. In 2017, there were 907 Staff solution companies in the United States alone, servicing 3.7 million worksite employees (WSEs), which were spread over approximately 175,000 clients. Find out how does the new revenue recognition guidelines impact the staffing solution Company
ASC 606 – Healthcare Industry
ASC 606 provides a robust framework for addressing revenue recognition issues and, upon its effective date, replaces almost all existing revenue recognition guidance, including industry-specific guidance, in the current U.S. generally accepted accounting principles (GAAP). This major overhaul of revenue recognition affects almost every industry, and health care is no exception. The complex arrangements between healthcare providers, patients, and insurance companies pose some of the most difficult issues for the new standard. Due to various payment methodologies, self-pay patients, and numerous services that may be involved in a single contract, application of the five-step revenue-recognition model can be particularly complicated.
ASC 606 – Telecommunication
The telecommunications industry is in for major changes in the revenue recognition framework with the introduction of ASC 606. The new standard affects various aspects of revenue recognition such as contractual values, timing, and extent of recognition. It will also impact financial reporting and disclosures. The following document summarizes how the 5-step model applies to telecommunications industry along with a practical example.
ASC 606 – Construction Industry
With ASC 606 introduction, also comes the challenges for various industries to get in sync with the new guidelines. However, if the 5 steps are clear to the business then the transition could be a lot easier.
This publication is to guide the Construction Industry on how to embrace the new guidelines with ease by explaining all the 5 steps in detail and how to take care of variable consideration attached to a contract based on expected value method.
ASC 606 – Law Firms
ASC 606 is applicable across all the industries effectively starting 1 January 2018 for public companies, and no later than 31 December 2019 for all other companies and aid in recognizing revenue from all the types of transactions, except those transactions which are covered by more specific guidelines (for example – Insurance Contract or Leasing Contract). ASC 606 outlines a single all-inclusive model for accounting for revenue from customer contracts.
This article highlights how the 5 steps of the new guideline have to be aligned to the existing business process of a law firm and briefly explains the 5 steps with a practical example.
ASC 606 – Asset Management Company
With ASC 606 introduction, also comes the challenges for various industries to get in sync with the new guidelines. However, if the 5 steps are clear to the business then the transition could be a lot easier. Similarly, an Asset management company will find it though to value the investees, the major change with the introduction of the new guidelines is in the revenue stream “Two and Twenty”.
This publication is to guide the Asset management company on how to embrace the new guidelines with ease.
ASC 606 - Communication Software
The new revenue standards (ASC 606 Revenue from Contracts with Customers) replace industry-specific guidance with a single revenue recognition model. The accounting for communication software products and services is expected to be one of the areas most impacted by the new standards.
This document summarizes the impact of the new guidelines on the communication software industry, breakdown of the 5 step model and how a communication business should handle the transition period.
ASC 606 – Hotel Industry
ASC 606 is applicable across all the industries effectively starting 1 January 2018 for public companies, and no later than 31 December 2019 for all other companies and aid in recognizing revenue from all the types of transactions, except those transactions which are covered by more specific guidelines (for example – Insurance Contract or Leasing Contract).
The new revenue guideline will impact the way the Hotel have been recognizing the revenue. Hotel business must analyze the transition method and the revenue recognition policy to align with the new guidelines, here is a simple case study which might help business to align with the new guideline.