We continue our series on challenges in adoption of FASB Accounting Standards Codification (FASB ASC 606), Revenue from Contracts with Customers, providing sanitized excerpts of workpapers purporting to provide audit evidence regarding compliance with FASB ASC 606 and detail why we feel the excerpts are either insufficient or incorrect. In this report, we discuss requirements related to recognizing revenue when products have not shipped. These arrangements are commonly known as “bill-and-hold” transactions.
Bill-and-hold transactions take place for a wide variety