License, Royalty Accounting Among Top Revenue Standard Concerns

Three issues came up over and over as U.S. accounting rulemakers asked companies, investors, and auditors for feedback on the major accounting change that overhauled how companies report the top line in their income statements.

The questions relate to how the landmark revenue recognition accounting standard deals with licenses, variable payments, and the complex judgments around when a company is the primary supplier of a good or service as opposed to an agent who merely arranges sales.

“These are simply areas where we heard some frequent comments where ...