As companies worked through the implementation of the new revenue recognition standard they dealt with two issues surrounding ICFR:<\/p>\n
What changes were required to ICFR for this new standard, and<\/p>\n
Whether or not these changes to ICFR required reporting a material change in ICFR.<\/p>\n
Reporting material changes in ICFR is a requirement in both Form 10-K and Form 10-Q and involves substantial amounts of judgment.\u00a0 This post<\/a>reviews the details of this requirement.<\/p>\n As we grapple with the new Lease and Credit Losses standards, to help us with the ICFR change process, FEI published two research studies in November 2018:<\/p>\n A Lessee’s Guide to Implementing Internal Control over Financial Reporting for contracts accounted for under Accounting Standards Codification (ASC) 842, Leases<\/a><\/p>\n and<\/p>\n A Guide to Implementing Internal Control over Financial Reporting for the Current Expected Credit Loss (CECL) Standard<\/a>.<\/p>\n The reports were issued by FEI\u2019s Committee on Corporate Reporting (CCR).\u00a0 (Our workshop leader Reed Wilson is a member of CCR, and thanks to him for the heads-up about these reports).\u00a0 Both are designed to help companies anticipate ICFR issues they may encounter as they implement these new standards and also provide examples for documentation and processes.<\/p>\n As always, your thoughts and comments are welcome!<\/p>\n","protected":false},"excerpt":{"rendered":" As companies worked through the implementation of the new revenue recognition standard they dealt with two issues surrounding ICFR: What changes were required to ICFR for this new standard, and Whether or not these changes to ICFR required reporting a material change in ICFR. Reporting material changes in ICFR is a requirement in both Form … Continue reading Preparing for Year-End 2018: Number Nine \u2013 FEI Insights About Changes in ICFR for New Accounting Standards<\/span>