Time Shrinkage

“Don’t Squander Time…” A lot is written on call center time shrinkage and ways to address it to increase productivity. This blog is not about call centers. This article is not based on scientific or statistical research. It’s not about whether time is real or illusionary (we’ll leave that for the theoretical physicists.) This article, instead, is about time as it relates to the accounting profession. Those in public accounting believe that time is real. Over the years, time shrinkage has crushed us, causing many to miss untold evening newscasts, home-cooked meals, favorite TV programs, monster hide-and-seek with the kids, Read More »

Revenue Recognition For Contractors

Does it Seem Easier Now? Now that contractors have a few years of practical experience working with the revenue recognition standards under ASC 606, does it seem a bit friendlier than expected? Perhaps so. Or maybe it seems that way because we’ve been working with it for a while now. We thought this would be an excellent time to review a few significant tenants of the standard. After working with ASC 606 for a time, a refresher of pivotal provisions may help solidify our understanding. So briefly–here we go. Remember the five steps? Identify the contract(s) with a customer Identify Read More »

Leases – Part Five

Five Areas Where It’s Easy to Stump Your Toe ASC 842 is in full swing now. Most private companies and CPA firms have been in the weeds for some time. It would be an understatement to say the standard is massive and not entirely transparent. Because ASC 842 is principle-based and yet very specific in certain areas, it’s far too easy to make implementation errors. In no particular order, here are my top five areas prone to mistakes. Misunderstanding the Effective Date for Interim Financial Statements. The effective date for private companies and private not-for-profit entities is fiscal years beginning Read More »

Leases – Part Four

Common Control Lease Arrangements – Give Me a Break? On November 30, 2022, the FASB issued, for public comment, Exposure Draft 2022-ED500 Leases (Topic 842)-Common Control Arrangements (Update). The Update proposes significant changes to common control arrangements (leases between related party entities) in two areas: Issue 1. Determining if a related party lease between entities under common control exists and, if so, the classification and accounting for that lease, and Issue 2. Lessee accounting for leasehold improvements associated with leases between parties under common control. The proposed amendment to Issue 1 above would be available as a practical expedient for Read More »

Leases – Part Three

Lease Accounting is No Cake-Walk I remember when the Financial Accounting Standards Board issued FAS No. 13, Accounting for Leases, in November 1976. I was tasked with outlining the standard for the firm where I worked. Now, here it is in November, some 46 years later, and I’m looking at the latest rendition of the lease standard—ASC 842. When comparing the two, FAS 13 was much kinder and gentler than ASC 842, even though FAS 13 did not seem that way at the time. Under FAS 13, there were bright lines, and the accounting was more straightforward. For example, operating Read More »