Revenue Recognition – ASC 606 Roundup: 08/14/2018

This week’s edition covers both relevant news articles as well as a recent comment letter/company’s response on ASC 606.

To quickly identify ASC 606 information in the below links, click on the link, hit Control + F, enter the text “606” or “2014-09”, and click the down arrow button.

Are you reading these weekly rev rec blogs?  If so, please let us know what you think in the comments section; we will tailor future weekly roundups to the most relevant, timely, content based on feedback from you! And as always, feel free to reach out to us to learn more about SOFTRAX and the value we can provide for your company’s ASC 606 adoption!




  • The “Sales Returns and Price Protection Reserves” section on page 14 offers a detailed qualitative description of how ASC 606’s variable consideration requirement affects the company as does the top of page 42.
  • Page 45 provides details on ASC 606’s impact on net revenue by product and service.

Our thoughts:   This filing offers 18 references to ASC 606.  Most notably, the section named “Our reported financial results could be adversely affected by changes in financial accounting standards” on page 64 should be reviewed as it discusses the company’s assessment of how ASC 606 had a material impact on the way it recognizes revenue.


GTT Communications, Inc., 10-Q

  • The 4th paragraph of the “Revenue Recognition” section on page 9 offers insight into how the company treated its fixed versus variable considerations. Notably, the filing offers details on how usage fees and early termination fees were handled under ASC 606.
  • See the “Newly Adopted Accounting Principles” section on page 18 as it offers further qualitative details on the company’s ASC 606 adoption and its impact.

Our thoughts:   While the company makes a statement in its filing that ASC 606 did not have a material impact on its financials, it offers a good amount of details throughout the document to work up to the point.  This has value as it’s an example where a company, in spite of its assessment of no material impact on its financials, still put forward qualitative and quantitative details for readers of the filing to support this assertion.



  • Page 7’s “General description of the new guidance” gives a high-level picture as to why the company identified that ASC 606 would impact the timing of its revenue recognition.
  • Starting on page 7, and running through page 10, are a number of references to ASC 606 with comparative quantitative results worth a review.

Our thoughts:   The value of this filing is that it offers a clear picture of how ASC 606 impacted the timing of its revenue recognition when compared to ASC 605.  Furthermore, the level of detail regarding its handling and presentation of Contract Assets as a result of ASC 606’s impact is one of the better we’ve reviewed to date.


ASC 606 is not a challenge your company has to face settling for limited functionality in existing systems or through high-risk manual efforts.  SOFTRAX provides superior experience, knowledge, products, and services to address your company’s ASC 606 needs.

We encourage you to contact us to learn more about SOFTRAX and the value we can provide for your company’s ASC 606 adoption. 

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