In each episode of our What’s trending in SEC comments series, our guests bring you the latest themes in comment letters from the Division of Corporation Finance for the most common topical areas of the financial statements.

This week we focus on revenue. Angela Fergason, PwC National Office partner, joined Heather Horn to break down the questions raised in SEC comments, giving you a deeper understanding of the SEC staff’s expectations and context and insights into the GAAP requirements.

Topics include:

• 1:20 - What types of comments are companies getting? Angela and Heather discuss the different types of comments and give some examples of when each has come up. Common questions relate to completeness of disclosures, consistency with other disclosures, and requests for supporting analysis. And one hint for preparers: don’t use boilerplate language!
• 10:46 - Top elements of revenue guidance sourcing comments. Angela gives five topics where comments have been more prevalent: disaggregated revenue, determining the transaction price, identifying performance obligations, principal vs. agent, and timing of revenue recognition.
• 21:14 - What’s ahead? Angela shares what might be around the corner as attention is increasing for certain comments, including separately reporting certain categories of revenue in compliance with S-X Rule 5-03(b). 
• 23:34 - Perspectives on responding. Angela closes with two pieces of advice for issuers when responding to an SEC comment letter. Heather tries to stump Angela with some niche accounting questions.

Want to learn more? Listen to Angela’s other podcast episodes on revenue, including Full disclosure: Revenue, Identifying performance obligations: PwC breaks it down, and Variable consideration: How it impacts your top and bottom line.

Angela Fergason is a partner in PwC's National Office with over 20 years of experience who specializes in accounting for revenue and employee compensation arrangements. She is a frequent speaker on accounting and financial reporting topics and is a contributor to many PwC National Office publications, including our accounting guides on revenue and stock-based compensation.

Heather Horn is PwC’s National Office thought leader, responsible for developing our communications strategy and conveying firm positions on accounting and financial reporting matters. She is the engaging host of PwC’s accounting and reporting weekly podcast and quarterly webcast series, as well as periodic webcasts for the power and utilities industry. With over 30 years of experience, Heather’s accounting and auditing expertise includes financial instruments and rate-regulated accounting.

Transcripts available upon request for individuals who may need a disability-related accommodation. Please send requests to [email protected].

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