KPMG recently surveyed over 140 companies across a wide range of industries to understand how accounting executives are responding to the challenge of implementing the new revenue recognition and leases accounting rules from the Financial Accounting Standards Board (FASB).
The survey reveals that companies are behind in their implementation efforts for revenue recognition. Respondents indicated that their revenue recognition implementation efforts have been hampered by competing internal business priorities, human resource constraints, and financial limitations, with just seven percent of respondents reporting that they have completed their assessment activities and advanced to actually implementing the new rules.
Despite the effective date being over 2 years away, it is necessary for companies to start thinking about compliance for the leasing standards. According to the survey, only a small percentage of companies have begun creating an inventory of their leases and appear to be most challenged by inadequate IT systems unable to capture relevant data.
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