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FASB complete gross versus net guidance for revenue recognition

Tammy Whitehouse | March 17, 2016

The Financial Accounting Standards Board has issued an update to accounting standards meant to put to rest any confusion that may still exist on how to apply the principal-versus-agent guidance in the new revenue recognition rule.

FASB issued ASU 2016-08 to answer uncertainties that arose as companies dug into the massive new revenue recognition standard issued in 2014 to prepare for its adoption in 2018. The guidance addresses how to recognize revenue when there’s a third party to a transaction that might leave room for questions on whether the reporting company represents the principal in a three-way relationship or an agent of someone else. That...

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