Issue link: https://construction.trimble.com/en/resources/i/1520032
Page | 51 retrospectively restate the contract for contract modifi cations. The entity can instead refl ect the aggregate eff ect of all contract modifi cations that occur prior to the start of the earliest period presented in the fi nancial statements for the following: a. Identifying the satisfi ed and unsatisfi ed performance obligations. b. Determining the transaction price. c. Allocating the transaction price to the satisfi ed and unsatisfi ed performance obligations. If any practical expedient is used, the fi nancial statements will need to disclose that the expedient has been used and also disclose "to the extent reasonably possible, a qualitative assessment of the estimated eff ect of applying each of those expedients." 1. What are the issues at hand in regards to implementation? An entity applying the full retrospective method to all prior periods presented must disclose: a. The nature of, and reason for, the change in accounting principle. b. A description of the prior period information adjusted and the eff ect on prior periods of income from continuing operations, net income and other fi nancial statement line items. c. The cumulative eff ect on retained earnings. d. If impractical to adjust prior periods, the reasons therefore. e. If indirect eff ects of the change are applicable, a description and the amounts recognized in the current year. And, if practical, the amounts applicable to each prior year presented. f. The required disclosures shall be presented in any interim statements. g. If practical expedients are used, a qualitative assessment of their estimated eff ects is needed. 2. What is CICPAC's interpretation as to what the accounting needs to be? See recommendations on page 54. 3. What does the entity need to do (internally) to comply? If an entity chooses this method, is non-public, and adopts for calendar year 2019, they need to start gathering the data for disclosures and be able to account for these contracts in accordance with this standard in 2018. Entities need to decide which, if any, of the practical expedients they want to apply. Transition Method (continued) >