Wiley GAAP 2008

Other Special Accounting and Reporting Issues

Table . 10-1: Sources of GAAP

EITF
99‐19, 00‐8, 00‐21, 01‐9, 02‐16, 3‐10, 06‐1

As discussed in the opening section of the chapter, guidance on the proper accounting for revenue under US GAAP remains diverse, without one self‐contained authoritative source of prescriptive advice. While FASB is attempting to address this (and might fundamentally revise the foundations for revenue recognition if the “balance sheet oriented” standard being debated is ultimately promulgated), at the current time practitioners must be familiar with, and able to apply, a large number of standards. The major categories of revenue generating transactions, for which specialized accounting standards have been developed, have been addressed in the earlier sections of this chapter. In the following paragraphs, various miscellaneous requirements contained in EITF consensuses are discussed.

A longstanding issue in financial reporting has been whether certain entities more accurately convey the nature of their operations by reporting as revenue only the “net” amount they retain when acting effectively as an agent for another entity. While in some situations the answer is obvious, in other cases it has been less clear. Historically this may not have been an urgent issue to be resolved, since users of financial statements were deemed capable of deriving correct inferences regardless of the manner of presentation of the income statement. However, in recent years an unfortunate ...