1.5 CPE On May 28, 2014, the Financial Accounting Standards Board (FASB) and International Accounting Standards Board (IASB) issued converged guidance on recognizing revenue in contracts with customers (ASC 606). The objective of the guidance is to establish principles to report useful information to users of financial statements about the nature, amount, timing and uncertainty of revenue from contracts with customers. The new guidance provides several benefits to financial statement users. Entities applying the new standard for contract revenue recognition will follow five steps:
- Identify the contract with the customer
- Identify performance obligations
- Determine transaction price
- Allocate transaction price to performance obligations
- Recognize revenue when each performance obligation is satisfied
Although these steps may seem simplistic at the surface, within each step are multiple components and considerations users must be aware of. This course will delve into the many concepts involved in Step One: Identifying the contract.
The course utilizes many examples from numerous industries to enhance learning of the various concepts.
Note: Information within this course comes from readily available public domain documents and is utilized by the trainer as a supplement for relaying the course content.
Resources Consulted:
• ASC 606-10-32-15 to 32-20, 55-244 to 55-246.
• ASU 2014-09: “Revenue from Contracts with Customers.” BC229-BC247.
• Croner-I, “A14 Revenue from Contracts with Customers.” (2019). Section 7.4.2-2 and 7.4.2-2.
• FASB, ”Revenue Recognition Implementation Q&As.” January 2020). Questions 31-37.
• FASB TRG Memo 20: “Significant Financing Components.” 26 January 2015.
• FASB TRG Memo 30: “Significant Financing Components.” 30 March 2015.
• EY, Financial Reporting Developments: “Revenue from contracts with customers.”January 2020. Section 5.5.
• KPMG, Handbook: “Revenue Recognition.”December 2019. Section 5.5.
• PWC, “Revenue from contracts with customers”March 2020. Section 4.4.
• https://www.revenuehub.org/
Learning Objectives
- Recognize how elements of the new revenue recognition standard differ from the previous standard.
- Explore various criteria in the step “Identify the Contract" including:
- Approval/commitment of parties
- Identification of rights of parties
- Payment terms can be identified
- The contract has commercial substance
- Collection is probable
- Identify when a contract modification requires a new contract or can be combined with the original contract.
- Explore accounting for non-contract modifications.
- Explore accounting for contract modifications.
Last updated/reviewed: March 11, 2024
Included In Certifications
This course is included in the following Certification Programs:
17 CoursesRevenue Recignition (ASC 606) Certification
- Revenue Recognition (ASC Topic 606) Standard Overview
- Revenue Recognition (ASC Topic 606): Identify The Contract Part 1
- Revenue Recognition (ASC Topic 606): Identify The Contract Part 2
- Revenue Recognition (ASC Topic 606): Performance Obligations Part 1
- Revenue Recognition (ASC Topic 606): Performance Obligations Part 2
- Revenue Recognition (ASC Topic 606): Transaction Price Part 1
- Revenue Recognition (ASC Topic 606): Transaction Price Part 2
- Revenue Recognition (ASC Topic 606): Allocating Transaction Price
- Revenue Recognition (ASC Topic 606): Recognize Revenue
- Revenue Recognition (ASC Topic 606): Scenarios For Identify The Contract
- Revenue Recognition (ASC Topic 606): Scenarios For Performance Obligations
- Revenue Recognition (ASC Topic 606): Scenarios For Transaction Price
- Revenue Recognition (ASC Topic 606): Scenarios For Transaction Price And Recognize Revenue
- Revenue Recognition (ASC Topic 606): Case Scenarios Part 1
- Revenue Recognition (ASC Topic 606): Case Scenarios Part 2
- Revenue Recognition (ASC Topic 606) COVID Implications
- Revenue Recognition (ASC Topic 606): Disclosure Requirements “Contracts with Customers”
128 Reviews (545 ratings)
Reviews
Anonymous
(internal auditor)
Когда весь мир движется в сторону международных стандартов финансовой отчетности, америка выпускает свои собственные стандарты. Надеюсь, что мой кругозор расширился до невообразимых размеров!
Anonymous
(Audit Manager)
Everything is making sense but I guess what I'm struggling with is how to identify the "differences" between ASC 606 vs previous version. I felt like all the things that you said existed before. I was wondering if there is a summary/table available where I can clearly see the difference in transaction treatment between ASC 606 and the old version.
Emily Moran
(Director of Finance at Kurtosys Systems)
The new revenue recognition guidance is clearly and carefully discussed and this is a good overview. However, more compare/contrast could be particularly helpful when thinking about modifying revenue recognition practices. The instructor thorough and very clear. I also really like that she connects concepts to underlying principles/definitions.
Rahman Ullah
(Senior Accountant at Cardtronics)
Lynn does an excellent job in taking her time explaining the concepts of the new Revenue Recognition standard. At times she can be a little slow in the pace of the presention, but she does cover it in fair detail. I would have liked to see some financial reporting implications, journal entries, etc. Overall a great introduction to the topic.
Anonymous
(Vice President of Technical Accounting)
Good course for regular subscription price (not certification price). Benefited from taking all the courses. A lot of repetition could be viewed as reinforcing or redundant depending on how quickly can learn. Would rely on wording on slides more than those spoken, as less technically precise. Now have strong foundation in ASC 606.
Karis Davis
(Finance Director at Belden)
I am currently a Director of Revenue Recognition. This is a great overview for folks unfamiliar with revenue recognition. However, this course is not substantive enough to prepare students for the complexities of real-world contracts. The examples provided in the course are very simplistic.
Anonymous
(Partner)
The author continues to assist in trying to understand the application of "big" GAAP to the companies that the majority of CPAs service. It would be nice if our governing boards would notice that the application of Big GAAP is .... to real companies.
Anonymous
(Revenue Assurance Manager)
I am just beginning my journey into understanding 606 in greater detail. This course is a great overview of identifying contracts and customers, with some good hypothetical examples when breaking down the main criteria for identifying the contract.
Anonymous
(Risk manager)
the course was a little bit confused, and after I listened to the course, I still am a little unfamiliar with the revenue recognition step 1,and do not know the first step in getting started to recognize revenue. Hope the language be more clear!
Anonymous
(Inventory Accounting Manager)
There were lots of great examples that helped make the training easier to understand. It was also good that the this topic has been broken down into bite size pieces making it easier to digest and gain a better understanding of the material.
Anonymous
(Associate Director)
The instructor does a great job of providing additional commentary to the training. She gives real life, easy to follow examples that provide clarity on the topic. Overall a great presentation on a deep dive into Step 1 of ASC 606.
Anonymous
()
Very helpful in understanding the specifics of Step 1 of the revenue recognition model, which at first sight seems to be the easiest of the 5 steps but actually has a lot of technicalities to it which are explained in this video.
Anonymous
(Assistant Controller)
Great course! Good to know the distinction between "revenue" and "income". This course showed me the criteria to identify a contract. I think this course is beneficial not only to finance teams, but also any sales team.
Anonymous
()
This was a great discussion of the components of a having a contract under the new revenue recognition criteria. This is definitely a good course to understand the basic contract under revenue recognition.
John Dever
(Senior Accountant at Learning Tree International)
This course was especially valuable for me. I am taking my first contracting class at a community college. It was great exposure to the issues regarding contracts and revenue. I look forward to Part 2.
Lawrence Hirsch
(Controller at Builders design)
Another great ASC606 course in the series. Lynn has this grouping of courses that are a must if you need to understand in a comprehensive way, the ASC606.
On to part 2 - I love her courses.
Larry
Anonymous
(Senior Accounting Coordinator)
This was very helpful in learning about contracts and when they are able to be used for rev rec and when they do not meet the requirements. There was a lot more that goes into than expected.
Inna Shmukler
(Controller at Fornetix LLC)
A very detailed overview of the requirement and considerations for identifying the contract. I liked all the examples. The presentation was very well organised, concise and to the point.
Anonymous
(Revenue Accountant)
This is a thorough review of the fundamental elements of Step 1 - Identify the Contract. It was very helpful and easy to follow. I recommend course as a primer or quick review.
Anonymous
(Accounting Manager)
The presentation was clear and concise - very good presenter.
The subject matter was dry - to no fault of the presenter. More audience engagement would have been appreciated.
Anonymous
(Sr. Accounting Manager)
Great overall course. Was helpful in understanding and brushing up on the basics of ASC 606. I liked the examples they helped to look at the material in real life situations.
Anonymous
(Senior Internal Auditor)
This course was a refresher of "Overview of Complying with the ASC 606 Revenue Recognition Standard". The instructor was very effective in presenting the course materials.
Jay Bineau
( at Seigler & Tweedlie)
The examples were excellent. there should be more multiple choice questions in the review questions then the final exam since there is a lot of material to fully understand
Anonymous
(Drone)
This course provided a fantastic overview of the fitst step in the new standard. I was pleasantly surprised at the way the old guidance and new guidance were presented.
Anonymous
(Sys Ops Manager)
The course was very informative and helped better understand the nuances and criteria related to Step 1 of the new ASC 606 rev rec standard. Examples were very insightful.
Alexandra Petroff
(Senior Associate at Frank Rimerman + Co. LLP)
Compare contrast section is not well written. It could use more clear "here is what last standard looked like" and "here is the new standard" even a table would be great.
Thomas Foster
(member at Foster & Company, LLC)
Would have preferred this as a text based course. It is difficult for me to stay committed to a video course. While a text based course I can go back to and refer to.
Jan Broadwater
(Controller at Consultant)
Excellent description of the criteria for identifying a contract. Example transactions were excellent and made the criteria language much easier to understand.
Anonymous
(Contoller)
This instructor provides and clear and well organized review of this section of the revenue recognition rules. Examples given are relevant and understandable.
Anonymous
(Sr. Director of Cost Management and Comp..)
Good course overview of ASC 606 contract identification. Several examples were used to held illustrate when a contract (revenue) exists and when it does not.
Chere Bramer
(Consultant at CLBM Consulting, LLC)
It appears that defining the terms are half the battle, so these courses that delve into each step are helpful for the overall understanding of the standard.
Asem Shaalan
(VP of Accounting at Peraton)
This course was great for me, I now understand the contract criteria which include approval and commitment, rights of the parties, payment terms and other
Lauren Reid
(Senior Accounting Manager at People.ai)
wish there were more detailed examples. examples provided besides the one about wash trades seemed too basic to encounter in a real fortune 500 business
Linda Forde
(Owner at The Forde Firm, LLC)
Ms. Fountain is engaging and clear. Her examples make this complex subject easy to understand and apply to one's own industry. Highly recommended.
Anonymous
(Director of Finance)
Lots of good information and examples. I am hoping to get more information on what constitutes a customer as it relates to partnership activities.
Anonymous
(Director - Technical Accounting)
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Anonymous
(Staff Accountant)
Good course covering the items needed to determine if a contract exists under the 606 standard. Lots of examples to help understand the concepts.
Anonymous
(solo)
Great course. Stated learning objectives were met. Program materials were relevant and contributed to the achievement of the learning objectives.
Dowton Martin
(Accounting and Finance Consultant at DLC Inc)
The review was very informative and I gathered a significant amount of knowledge from the material. I was surprised at the depth of the course.
Anonymous
(Director)
I liked that it broke down step one of 606 into great detail to really understand the terms and conditions of a contract under the guidance.
Jason Ng
(Assistant Finance Manager at Iron Mountain)
Good and clear explanation and I can understand it clearly. But I suggest if there is subtitles in the video, then it would be even better.
Liubov Barrington
(cpa at self-employed)
A lot to know about ACS606. Quite detailed lecture re: definition of the contract in this newer standard. One of the best instructors here.
Anonymous
()
Using examples that are stated in the Standard were not as helpful as the more original examples, such as the sale of the car to your son.
Anonymous
(Revenue Operations Analyst)
I think this course is very good for beginners and takes the appropriate time to address all industry terms and define them one by one.
Anonymous
(Sr. Accountant)
Lynn's notes and lecture were very easy to follow and straightforward, and it really made learning the material very efficient for me.
David Favret
(Director of Business Development at Deltha Corporation)
Presentation of information comparing and contrasting new standard to old one could have been organized better in slide presentation.
Joshua Bourquard
(Accounting Manager Financial Reporting a.. at TPx Communications)
Great overall lecture on the specifics of this topic including examples. Discussed in detail all the parts to identifying a contract.
Anonymous
(NA)
Very nicely explained with appropriate examples. The lecture is broken into parts which can be understood easily with no confusion.
Joe Isaacs
(Unemployed at N/A)
This was a good expansion on the basic training, a nice deep dive into the elements of the first step of identifying the contract.
Anonymous
(Owner & CEO)
The course provided a good, informative discussion of what to look out for when trying to identify if a customer contract exists.
Anonymous
(Corporate Accountant)
Revenue recognition: Identify the contract part is a great course. I learned a lot from the new revenue recognition standard.
Anonymous
(Director of Accounting)
This course is really necessary to get a better understanding of the new revenue recognition standard specifically step one.
Anonymous
(Accountant)
The course gave a picture of how to identify if a contract is as per the new standard, what constitutes a complete contract.
Anonymous
()
I was pleased with the result of this course and plan to continue studying this issue. Thank you very much. Good day sir!
Anonymous
(Audit Manager)
Very helpful to gain more understanding of the new revenue standard. I hope there will be a course specific to NPOs.
Anonymous
(GL Accountant)
This course assisted in identifying a contract, contract criteria, rights vs obligations among many other topics.
Anonymous
(Construction Assistant Controller)
The course is helpful to learn how to properly recognize revenue. It's outlined clearly and is easy to follow.
Sherri Yokomizo
(Senior Assistant Controller at Oracle + NetSuite)
Overview course with clear presentation and examples. Presents the segment of the new guidance knowledgeably.
Derek Ettinger
( at GP Fund Solutions, LLC)
Once again, Lynn did an excellent job walking through the concepts in an understandable, yet detailed, manner.
Abraham Minto
( at Abraham Minto LLC)
Another great course by Lynn. The ASC 606 Part 1 course includes helpful and practical interpretive guidance.
Nikita Guskov
(Head of IFRS Department at Uralkali)
I really liked the course, because it in simple terms explains fundamentals behind the new revenue standard.
Nilufer Shaikh
( at AccessHope)
Great information about the nuances of contracts under ASC 606 and revenue recognition for customer contracts
Anonymous
(Junior Auditor)
I sincerely appreciate you for the training. good course. looking forward to next part of training. thank you
Vandar Gonsalves-Barreiro
(Sr. Corporate Accountant, International at Mueller Water Products)
The course was explained clearly. I enjoyed learning the criteria needed for a valid enforceable contract.
Anonymous
(Accounting Manager)
The presentation is broken down into understandable sections. It is
clear with easy-to-follow examples.
Anonymous
(Revenue Manager)
Great overview and detail explanation of concept with easy to understand example. This was very helpful.
Bryan Chamberlain
(Controller at N/A)
The material was presented very effectively, and I'm looking forward to additional modules on this topic
GARETT JOHNSON
(Sr. Revenue Accountant at Genoa healthcare)
I liked the examples and the detail in using words and phrases strait from the text of the new standard.
Anonymous
(Accountant)
This course provides a sufficient level of content to understand the first step in the revenue standard.
Angela Duncan
(Consultant at DLC Group)
Good examples covering considerations for each step and very informative, especially on collectability
Anonymous
(Executive Director, Corporate Controller)
It provides a good summary of identifying a contract and the examples provided are easy to understand.
Anonymous
(Controller)
Very good course for a beginner in know the complexities of revenue recognition in a very simple way
Ann Marotta
(Consultant at DLC Group)
A good follow-up to the overview course giving more detail and examples for contract identification.
Megan Randa
(Senior Staff Accountant at OneLive LLC)
Very detailed and informative. Great as a review of the guidance or to supplement current education.
Halina Kovel
(Sr Revenue Accountant at Yelp)
Great overview of rev rec criteria under a new guidance. Very good examples and clear explanation.
Anonymous
(CFO)
This course was very well organized and the instructor was easy to understand. I would recommend.
Anonymous
(-)
A very well presented discussion of the topic. Interesing examples helped to provide clarity.
Anonymous
()
Great deep dive into contract issues arising from ASC606. Gives great real-world type examples.
Sean Flynn
(Accounting Manager at Rosemawr Management)
Good course on revenue recognition and the new and updated standards which are needed to be met.
Anonymous
(Chief Financial Officer)
As usual, the presenter does a great job in explaining the material in an organized fashion.
Weber Jodesty
(Director of Accounting at Cortland)
Great Course. I enjoyed the layout and the details and examples presented in this course.
abhimanyu Karki
(Consultant at DLC)
Could be shortened. The lessons seem to have been extended just for the sake of extension.
Anonymous
(Consultant)
Useful course for those who work with revenue and all accounting professionals in general.
Anonymous
(CFO)
Another great course on revenue recognition, a great refresher and with valuable insight.
Guan-Ru Lai
( at not available)
I learn how to compare/contrast elements of the new
standard with the previous standard.
Angelica Altamira
(SR Rev Accountant at na)
great course although I would like more examples based on the Software / SaaS industry.
Anonymous
(Revenue Accountant)
This course was fine for what it is. Very helpful to entry level revenue accountants.
Sergiy Korytko
(Revenue Manager at Instacart)
Very technical and informative. Really appreciated the industry insights at the end.
Anonymous
(Self)
Course subject was clear. Examples are the most helpful in applying the knowledge.
Anonymous
(Controller)
The information in this course is laid out in a logical, easy to understand manner.
Anonymous
(Consultant)
this is the third time completing this so i dont understand why its not advancing
Devina Whitley
(Financial Controller at SVFG)
Great job in breaking down contracts and providing easy to understand examples.
Dave Tingley
(VP Finance at AECOM)
Very knowledgeable presenter and communicated in appropriate degree of detail.
Dawson LaCasse
(Director - Corporate Accounting at MTD Products Inc)
Good discussion of the criteria to identify whether or not a contract exists.
Dennis Roberts
(CFO at Dynamic Quest LLC)
Good detail on what constitutes a contract. Information is clear and concise.
Anonymous
(Lead Revenue accountant)
Helpful material and great examples. Simple language and easy to understand.
Anonymous
(Manager)
Amazing content and easy to understand examples to master the core concepts.
Sam Bakhshalian
(VP Finance at Aspire Food Group)
The great examples illustrated the points brought up and were very helpful
Nadia Miller
(Team Lead Accounting US at Trustpilot Inc)
Great substance here, Lynn really knows how to break the concepts down.
Anonymous
(Analyst)
Very well instructed and really useful content within the class........
Julia Krikunova
(VP, Finance at Taborda Solutions)
Effective and relevant information. Instructor provided great examples!
Jim Ahern
(Principal at AFM)
clear and simple explanation of what a contract is for purposes of 606
Anonymous
(Sr. Manager, Revenue Recognition)
Good overview and summary of complex rules. The slides were helpful.
Anonymous
(Accounting Bookkeeper)
I liked the examples used in the presentation to explain the points.
Sharon King
(Contractor at Self employed)
The slides included all the necessary info to understand this topic.
Chris Grimes
(Rules Master at Cisco)
Good introduction to the nuances of contracts with the new standard.
Anonymous
(Senior FP&A Operations Manager)
The course is easy to follow, the instructor has some good examples.
Greg Biedenstein
(Accountant at Charter Communications)
great course i found this course to be very informative on contracts
Craig Campbell
( at National Reconnaisance Office)
Good course. Well constructed and presented. Met course objectives.
Doaa Ghali
(Sr Revenue Analyst at Tesla)
I felt this course need more examples to serve different industries
Anonymous
(Revenue Consultant)
It would be great if we can have more examples for SaaS products.
Anonymous
(Senior Accountant)
Excellent information and examples to help understand the concepts
Anonymous
(accountant)
The materials are clear with great examples and good explanations.
Anonymous
(CFO)
Pretty good general overview of first step. I like the examples.
Anonymous
()
informative course about the new practice on revenue recognition
Anonymous
(Corporate)
The material in this course is of great use. Highly recommended.
Anonymous
(Associate Director)
The course was very helpful in providing an overview of Step 1.
Kelly Woolum
(Controller at Healthcare Highways)
I like the video commentary and the examples that are reviewed.
Anonymous
()
Good deep dive into Step 1 of the new revenue recognition model
Anonymous
(Controller)
Very very helpful course on the new rev recognition standard!
Ada Ramirez
(Consultant at Robert Half)
This course is very well explained and easy to understand.
Anonymous
()
Great dive into step 1of new revenue recognition guidance.
Brandon Devlin
( at ATS Automation)
Great course. Thanks, I don't have anything to comment on.
Roanna Alahakkone
(accountant at ABC)
Very well laid out. Lots of examples to solidify points
Anonymous None
(Manager at None)
this course was very informative. great use of examples
Victor Fuentes
(Manager at RSM)
great, everyone should take it from controllers to CFO
Anonymous
(Sr. Revenue Accountant)
Good deeper dive into the first step of the process.
Jacinth Vidinha
(Controller at Madden Media)
Good instruction, good examples. Character limits.
Prerequisites
Course Complexity: Intermediate
No Advanced Preparation or Prerequisites are needed for this course. However, it is recommended to take the other courses in the series prior to completing this one.
Education Provider Information
Company:
Illumeo, Inc., 75 East Santa Clara St., Suite 1215, San Jose, CA
95113
Contact:
For more information regarding this course, including complaint and
cancellation policies, please contact our offices at (408) 400- 3993 or send an e-mail to
.
Lynn FountainCPA, CGMA, CRMA, MBA, cPIA, Consultant, Author, Trainer
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