PracticeAuditASB to issue guidance on revenue recognition

ASB to issue guidance on revenue recognition

Clarification on how firms should apply aspects of an accounting standard on revenue recognition, which could impact massively on a company's bottom line, is expected from the UK standards setter tomorrow.

Link: ASB to clamp down on revenue policy

The UK Accounting Standards Board’s Urgent Issues Task Force will publish an information sheet on Tuesday that is expected to deal with FRS5 after a committee meeting last week concluded that some areas of the standard do require further explanation.

Concerns had been raised that businesses could face huge tax bills next year due to the change in the treatment of partner’s time and the valuation of all work in progress at selling price.

Although some bodies have released interim guidance on the standard, it is thought that the lack of an authoritative clarification has damaged attempts to persuade the Inland Revenue to accept some form of smoothing arrangement for companies during the first few years of the new rules, according to The Herald.

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