CCRC Revenue Recognition ASC 606 – Actuarial & Accounting Impacts Update

In May 2014, after years of work between the Financial Accounting Standards Board (FASB), the International Accounting Standards Board (IASB), and other parties, FASB created a global, consistent revenue recognition model. With a single comprehensive recognition model in place, we can begin to explore its effects on the health care industry. The committee has been adamant that the rules will be firmed up by year’s end for implementation in 2017 or 2018.

Some specific issues to be considered are:

  • the accounting for nonrefundable entrance fees
  • monthly service fees versus expenses
  • conversion of non-refundable fees into income
  • how to allocate monthly fees – partition out
  • the transaction price is determined at inception
  • how many performance obligations to be considered
  • actuarial versus accounting impacts

What we are doing:

  • Currently working with our LifeCalc Amortization Software partner to update our software
  • Hosting a webinar with an accounting firm partner to address the actuarial and accounting impacts
  • Hosting calls with subject matter experts to keep abreast of possible standards changes

You can register for our November 15th webinar by clicking the following link