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FASB issues guidance on collaborative arrangements

  • FASB document Image

Nov 05, 2018

The FASB has issued Accounting Standards Update (ASU) No. 2018-18, “Clarifying the Interaction Between Topic 808 and Topic 606.”

The ASU amends ASC 808 to:

  • Clarify that in the context of the unit of account, ASC 606 should apply in its entirety to certain transactions between collaborative arrangement participants.
  • Add “unit-of-account guidance in Topic 808 to align with the guidance in Topic 606 (that is, a distinct good or service) when an entity is assessing whether the collaborative arrangement or a part of the arrangement is within the scope of Topic 606.”
  • Clarify that when a transaction is not directly related to sales to third parties, presentation of the transaction as revenue would be precluded if the collaborative participant counterparty is not a customer.

For more in­for­ma­tion, see the press release and ASU on the FASB’s Web site.

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