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SEC and Staff Issue Interpretative Guidance on Revenue Recognition

On August 18, the Securities and Exchange Commission issued a press release announcing its issuance of two releases and the SEC staff’s release of a Staff Accounting Bulletin to provide updates to interpretative guidance on revenue recognition.

The SEC updated its guidance on bill-and-hold arrangements, providing that registrants should no longer refer to criteria in Accounting and Auditing Enforcement Release No. 108, In the Matter of Stewart Parness, to recognize revenue for such arrangements upon the registrant’s adoption of Accounting Standards Codification (ASC) Topic 606 (Revenue from Contracts with Customers).

The SEC updated its 2005 guidance on Commission Guidance Regarding Accounting for Sales of Vaccines and Bioterror Countermeasures to the Federal Government for Placement into the Pediatric Vaccine Stockpile or the Strategic National Stockpile, providing that manufacturers should recognize revenue for vaccines that are placed in the Vaccines for Children Program and the Strategic National, consistent with ASC Topic 606.

The SEC’s Office of the Chief Accountant and Division of Corporation Finance released Staff Accounting Bulletin No. 116 (SAB 116), which conforms SEC staff guidance on revenue recognition to the Financial Accounting Standards Board’s adoption of, and amendments to, ASC Topic 606.

The SEC and SEC staff noted that, until a registrant adopts ASC Topic 606, it should continue to rely on prior guidance.

The press release is available here.

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About this Author

Mark D. Wood, corporate securities lawyer Katten Muchin Chicago Law firm
Partner

Mark D. Wood is head of Katten's Securities practice and concentrates in corporate and securities law. Mark represents public companies, issuers and investment banks in initial public offerings (IPOs) and other public offerings, private investment in public equity (PIPE) transactions, debt securities and other securities matters.

Mark also represents clients in complex corporate transactions, including tender offers, mergers, acquisitions, dispositions, going-private transactions, private equity investments, joint ventures and...

312-902-5493
Mark Reyes Securities Lawyer Katten Muchin law firm Chicago office
Partner

Mark J. Reyes concentrates his practice in corporate and securities matters, including representing issuers and investors in public offerings and private placements of equity and debt securities and advising clients in complex corporate transactions such as mergers, acquisitions, private investments in public equity (PIPEs), private equity investments and joint ventures. He also counsels public companies on securities law compliance, disclosures and corporate governance matters.

Shown below is a selection of Mark’s engagements.

  • Representation of hospitality company in connection with its initial public offering and listing on NYSE, as well as ongoing counseling with respect to compliance with securities laws and NYSE rules, disclosure and corporate governance matters.
  • Representation of NASDAQ-listed public company in the banking industry in connection with strategic transactions, capital raising transactions, compliance with securities laws and NYSE rules, disclosure and corporate governance matters, including strategic acquisitions, notes offering and at-the-market offering.
  • Representation of clean tech manufacturer for industrial equipment in connection with alternative public offering and listing on NASDAQ, as well as ongoing counseling with respect to compliance with securities laws and NASDAQ rules, disclosure and corporate governance matters.
  • Representation of NASDAQ-listed issuer in connection with selling stockholder block trades.
  • Representation of NYSE-listed industrial manufacturer with respect to compliance with securities laws and NYSE rules, disclosure and corporate governance matters.
  • Representation of NASDAQ-listed medical device company with respect to compliance with securities laws and NASDAQ rules, disclosure and corporate governance matters.
312-902-5612
Shannon Traylor, Corporate Attorney, Katten Law Firm
Associate

Shannon Traylor concentrates her practice in general corporate matters.

While attending law school, Shannon was a member of the Virginia Journal of International Law and its submission review board. Prior to law school, Shannon worked in the Washington, DC area for a nonprofit devoted to nuclear nonproliferation.

202-625-3798