The Financial Accounting Standards Board has issued its formal proposal to defer the effective date of the revenue recognition standard, just after the International Accounting Standards Board voted to propose a one-year deferral for the international standard as well.

FASB’s deferral proposal would delay the effective date of the comprehensive new revenue recognition standard by one year. It also asks for views, however, on whether FASB should allow two years beyond the current effective date for entities that apply the new standard retrospectively, meaning applying it to all three years presented in financial statements as if it had always been in effect. The IASB will publish an exposure draft for public comment asking for views on whether the revenue recognition standard’s effective date should be moved back one year to Jan. 1, 2018.

The two boards issued their highly converged standards on revenue recognition in late May 2014, several months later than expected, giving companies two-plus years to prepare for implementation of the standard by 2017. Since then, the boards’ Joint Transition Resource Group has fielded dozens of implementation issues and referred a handful of them to the boards so they can consider amending or clarifying the original guidance.

FASB is preparing exposure drafts to clarify certain aspects of the standard around licensing of intellectual property and identifying performance obligations, along with some practical expedients meant to simplify adoption. The IASB is considering some similar, though less extensive, revisions for companies following International Financial Reporting Standards.

FASB says it knows of at least some companies that have put diligent effort into implementation planning and want to adopt the standard as scheduled in 2017. As such, the board plans to propose allowing companies to adopt the standard as of the original effective date if they are prepared to do so. The international standard already permits early adoption.

The IASB said it moved to defer the effective date for two reasons. The board is planning to issue an exposure draft with proposed clarifications arising from implementation discussions at the TRG, and the IASB wants to keep its effective date aligned with the FASB’s effective date. Accounting experts have said implementation would be difficult for multinational companies reporting under both standards in different jurisdictions if the effective dates differed.

Speaking at a regional conference of the Institute of Management Accountants recently, Alison Spivey, a partner with EY, said many companies are happy with the delay, despite the two-plus years initially provided for implementation. “We’re going from prescriptive rules to a principles-based standard, so that may not be enough time to thoroughly think through the accounting issues, the internal controls, and the system changes,” she said.

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