One of the biggest developments in 2014 was the FASB’s and IASB’s issuance of their joint standard on revenue recognition, which outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance, including industry-specific guidance. Further, the boards formed a joint revenue transition resource group (TRG) to seek feedback on potential issues related to implementing the new revenue standard. In addition, the FASB made progress on its broad projects to (1) work with the PCC to develop alternative guidance for private companies and (2) simplify certain aspects of U.S. GAAP. Meanwhile, the IASB issued IFRS 9, which represents the completion of its financial instruments project. The new standard substantially revises IFRS guidance on classification and measurement, including impairment, as well as hedge accounting.

So what will be the focus for 2015? In addition to the FASB’s simplification efforts, the potential use of IFRSs in the U.S. reporting system remains on the table. Previously, the SEC has considered three potential alternatives: (1) adopting IFRSs outright, (2) giving U.S. registrants the option of filing IFRS financial statements, and (3) using the so-called “condorsement“ approach. At the 2014 AICPA Conference on Current SEC and PCAOB Developments, James Schnurr, chief accountant in the SEC’s Office of the Chief Accountant, mentioned the possibility of a fourth alternative in which U.S. companies would be permitted to voluntarily provide IFRS-prepared financial information as a supplement to their U.S. GAAP financial statements.

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