Graduation Year
2017
Date of Submission
4-2017
Document Type
Campus Only Senior Thesis
Degree Name
Bachelor of Arts
Department
Economics-Accounting
Reader 1
Matthew Magilke
Terms of Use & License Information
Rights Information
© 2017 Lindsay A Slocum
Abstract
This thesis examines the various impacts of the new revenue recognition accounting standard on software companies. It begins by explaining why the FASB and IASB updated the existing revenue recognition standard and then compares and contrasts the legacy GAAP to the upcoming GAAP standard. It then moves into a detailed analysis of the key changes affecting the software industry, specifically: intellectual property, the elimination of vendor specific objective evidence, and the principal versus agent consideration. Additionally, it examines software as a service in comparison to the historical model of software as a product and how the new standard will impact the direction of the software industry. Finally, it concludes with a discussion of investor considerations and how the standard will impact users of the financial statements. While there is abundant knowledge of the accounting change within the accounting industry, there is less knowledge and almost no quantifiable information for the public, which based on the various changes detailed, will result in a surprising material effect on software company financial statements.
Recommended Citation
Slocum, Lindsay, "What are the Effects of the New Revenue Recognition Accounting Standard on Software Companies?" (2017). CMC Senior Theses. 1655.
https://scholarship.claremont.edu/cmc_theses/1655
This thesis is restricted to the Claremont Colleges current faculty, students, and staff.