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PwC is pleased to offer our accounting and financial reporting guide for Revenue from contracts with customers. This guide summarizes the applicable accounting literature, including relevant references to and excerpts from the FASB’s Accounting Standards Codification (the Codification). It also provides our insights and perspectives, interpretative and application guidance, illustrative examples, and discussion on emerging practice issues. The PwC guides should be read in conjunction with the applicable authoritative accounting literature.
References to US GAAP
Definitions, full paragraphs, and excerpts from the FASB’s Accounting Standards Codification are clearly designated, either within quotes in the regular text or enclosed within a shaded box. In some instances, guidance was cited with minor editorial modification to flow in the context of the PwC Guide. The remaining text is PwC’s original content.
References to other PwC guidance
This guide provides general and specific references to chapters in other PwC guides to assist users in finding other relevant information. References to other guides are indicated by the applicable guide abbreviation followed by the specific section number. The other PwC guides referred to in this guide, including their abbreviations, are:
  • Business combinations and noncontrolling interests (BCG)
  • Financial statement presentation (FSP)
  • IFRS and US GAAP: similarities and differences (SD)
  • Leases (LG)
  • Not-for-profit entities (NP)
  • Property, plant, equipment and other assets (PPE)
  • Transfers and servicing of financial assets (TS)

Summary of significant changes
Following is a summary of the noteworthy revisions to the guide since it was last updated. Additional updates may be made to future versions to keep pace with significant developments.
Revisions made in August 2021
Chapter 10, Principal versus agent considerations
  • Chapter 10 was updated and reorganized to further clarify the principal versus agent assessment. The more significant updates include:
    • Figure RR 10-1 and Figure RR 10-2 were added to illustrate the parties in a three-party arrangement and the steps in a principal versus agent assessment, respectively.
    • Question RR 10-1 was added to address whether a reporting entity can elect to present revenue on a net basis.
    • RR was updated to add examples of evidence that a reporting entity is primarily responsible for fulfillment.
    • Figure RR 10-3 was added to summarize the revenue recognition implications of the principal versus agent assessment.
    • RR 10.3 was updated, and Example RR 10-5 and Example RR 10-6 were added, to clarify how the principal versus agent framework is applied when assessing an arrangement in which the reporting entity is in the role of a vendor/supplier/service provider.

Revisions made in April 2021
Chapter 4, Determining the transaction price
  • RR 4.6.2 was updated to clarify that payments to an end consumer might be made on behalf of a reporting entity’s customer and a promise to make a payment on a customer’s behalf could be explicit in the contract with the customer or implied based on customary business practices.
Chapter 13, Effective date and transition
  • RR 13 was deleted in its entirety since most public and private reporting entities have now adopted ASC 606.
Revisions made in January 2021
Chapter 3, Identifying performance obligations
  • RR was added to reference the optional expedient under ASU 2021-02, Franchisors—Revenue from Contracts with Customers (Subtopic 952-606), applicable only to nonpublic entities that are franchisors.
Chapter 8, Practical application issues
  • RR 8.4.4 was added to summarize the optional expedient under ASU 2021-02, Franchisors—Revenue from Contracts with Customers (Subtopic 952-606), applicable only to nonpublic entities that are franchisors.
This publication has been prepared for general informational purposes, and does not constitute professional advice on facts and circumstances specific to any person or entity. You should not act upon the information contained in this publication without obtaining specific professional advice. No representation or warranty (express or implied) is given as to the accuracy or completeness of the information contained in this publication. The information contained in this publication was not intended or written to be used, and cannot be used, for purposes of avoiding penalties or sanctions imposed by any government or other regulatory body. PricewaterhouseCoopers LLP, its members, employees, and agents shall not be responsible for any loss sustained by any person or entity that relies on the information contained in this publication. Certain aspects of this publication may be superseded as new guidance or interpretations emerge. Financial statement preparers and other users of this publication are therefore cautioned to stay abreast of and carefully evaluate subsequent authoritative and interpretative guidance.
The FASB Accounting Standards Codification® material is copyrighted by the Financial Accounting Foundation, 401 Merritt 7, Norwalk, CT 06856, and is reproduced with permission.

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