Additional Guidance with respect to Section 3400 – AcSB

Date recorded:

At its meeting on March 6-7, 2019, the AcSB continued its discussion on the proposed amendments to Section 3400, The Board considered the feedback from its Private Enterprise Advisory Committee on the proposed transitional provisions and effective date of the amendments. Based on the Committee’s feedback, the Board decided to propose transitional relief for the amendments relating to the percentage of completion method and multiple element arrangements.

The Board also decided that the proposed effective date for the amendments will be for fiscal years beginning on or after January 1, 2021. The AcSB also considered Committee members’ comments arising from their fatal flaw review of the proposed amendments.

Based on the feedback, the Board proposes to: (i) clarify the proposed guidance for using input and output measures to determine the degree of completion of a contract when using the percentage of completion method; (ii) include proposed guidance on the accounting for expected losses when it is probable that total contract costs will exceed total contract revenue when using the percentage of completion method; and (iii) simplify the proposed guidance for determining the stand-alone selling price of a good or service when accounting for multi-element arrangements.

Review the Executive Summary on the AcSB's Web site.

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