Of 600 companies analysed by the monthly publication, 43% do not even disclose a revenue recognition policy. Revenue recognition – or when a company books its sales – was a topic picked up by the Accounting Standards Board last year when it published a discussion paper intended as the first step in what is expected to be a protracted debate.
Until now, there has been no guidance in the UK on revenue recognition and accountants have been using their judgement as to what accounting policy should be applied, or turning to international or US standards.
According to the ASB: ‘The recognition and measurement of revenue are of fundamental importance to proper financial reporting.’
But, it is still unknown whether the ASB will recommend companies disclose revenue for each separate revenue stream or if it will follow the US model and stop at policy disclosure.
A Company Reporting analysis said: ‘Disclosure of how revenue is recognised is beneficial to analysts however an even more useful disclosure, which would allow comparability between companies, is the level of revenue that flows from each separate stream.
‘Thus far, it appears that company’s seem oblivious to the demand for this additional disclosure or are unwilling to provide it.’
Making Tax Digital will impose significant additional tax compliance costs on small businesses for little or no medium term benefit, tax and small business experts told MPs
MHA MacIntyre Hudson has partnered with cloud accounting software provider Xero ahead of the government’s requirement for digital records
The drive towards a fully digital tax regime is an admirable one, but mandation is simply wrong, according to one of the UK's most senior tax technology practitioners - Paul Aplin
Does Darwin's theory apply to taxation? Colin ponders...