This site uses cookies to provide you with a more responsive and personalised service. By using this site you agree to our use of cookies. Please read our cookie notice ( for more information on the cookies we use and how to delete or block them.
The full functionality of our site is not supported on your browser version, or you may have 'compatibility mode' selected. Please turn off compatibility mode, upgrade your browser to at least Internet Explorer 9, or try using another browser such as Google Chrome or Mozilla Firefox.

AICPA Alert Calls Out Audit Risks under New Revenue Rule

  • US_AICPA Image

Jul 06, 2016

On July 6, 2016, the AICPA issued an Audit Risk Alert entitled “Revenue Recognition: Accounting and Auditing Considerations—2016/17” (the Alert). The Alert is in respect of the new revenue recognition accounting standard, FASB Accounting Standard Update (ASU) No. 2014-09 Revenue Recognition, Revenue from Contracts with Customers (Topic 606). The Alert provides an overview of the new framework for revenue recognition, highlights differences between existing and new requirements, and outlines the many auditing considerations that companies should keep in mind as they adopt the new rule.

While the 110 page Audit Alert should help companies understand the accounting and financial reporting impacts of the new guidance, the real value may be in its focus on helping companies identify where they may have risks of misstatement as a result of adopting the new accounting requirements. A 7-page Protiviti summary of the AICPA alert says preparers and auditors will need to consider whether the company properly applied the new GAAP, whether the company properly applied its own internal accounting policies, the risk of misstatement associated with the nature of the company’s goods and services, and the structure and complexity of the company’s contracts with customers.

Correction list for hyphenation

These words serve as exceptions. Once entered, they are only hyphenated at the specified hyphenation points. Each word should be on a separate line.