Accounting Policy Update: Revenue recognition change for multiple deliverable arrangements

FASB ratifies two EITF Issues
On September 23, 2009 the FASB ratified two EITF Issues: 08-1, which relates to revenue arrangements with multiple deliverables, and 09-3, which deals with arrangements that include software elements. These two Issues are described below. Some constituents had expressed concern that, under the previous guidance, accounting for multi-element arrangements, such as Apple’s iPhone, did not reflect the underlying economics of the transactions. These changes will result in the earlier recognition of revenue for many multiple deliverable arrangements, although total revenue recognized and total cash flow received under these transactions would be unchanged.

>> Accounting Policy Update: Revenue recognition change for multiple deliverable arrangements September 2009 [PDF, 578 KB]