Heads Up – FASB defers effective dates of revenue and leasing standards for certain entities
On June 3, 2020, the FASB issued ASU 2020-05, which amends the effective dates of the Board’s standards on revenue (ASC 6062) and leasing (ASC 8423) to give immediate relief to certain entities as a result of the widespread adverse economic effects and business disruptions caused by the coronavirus disease 2019 (COVID-19) pandemic. Specifically, the Board deferred the effective dates of (1) ASC 606 for private companies and private not-for-profit (NFP) entities and (2) ASC 842 for private companies, private NFP entities, and public NFP entities. The deferrals apply only if those entities have not yet issued their financial statements (or made their financial statements available for issuance) as of June 3, 2020.
While the Board acknowledged that it will continue to evaluate the effective dates of its other standards, the ASC 606 and ASC 842 deferrals were a top priority given the upcoming adoption deadlines for private entities and public NFP entities.
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