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Revenue Recognition: Persuasive Evidence of an Arrangement

September 19, 2006 - AICPA
Level: Intermediate
Prerequisite: Experience in financial reporting.
CPE Credit: 2

There are four criteria that should be met before revenue is recognized: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred or services have been rendered; (3) the seller's price to the buyer is fixed or determinable; (4) collectibility is reasonably assured. In this course we look at one of these criteria: persuasive evidence of an arrangement exists. We will look at questions and answers concerning this topic from SEC Staff Accounting Bulletin (SAB) No. 104, various kinds of fraud schemes, how fraud affects revenue recognition, and internal control issues.

Course Highlights

• Persuasive evidence
• Practice Alert 95-1
• Practice Alert 98-3
• Audit Risk Alert
• Sham transactions
• SABNo. 104, Revenue Recognition
• Ethics

Course Objectives

• Be aware of revenue recognition issues pertaining to persuasive evidence of an arrangement.
• Be aware of schemes for prematurely recognizing revenue.
• Be aware of auditing considerations and internal control issues.

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