Perhaps I’m reading too much into it, but this guy thinks everyone needs to start freaking out over the new revenue recognition rules:
“Revenue recognition feels like a big, big issue,” said Zuora CEO Tien Tzuo, whose company specializes in software for managing subscriptions. “This feels as big or bigger than Y2K or SOX. SOX was a big heavy cost, but it wasn’t like you were in danger of missing your earnings call, or you had to report earnings that differed from expectations, not because anything changed in your business but because of accounting standards. We should be a little worried. There’s a surprise looming when earnings season kicks off at the start of next year and I don’t think we’re ready for it.”
Back in June we learned that more than one-fifth of companies admitted that they weren’t going to be ready. Here we are, three months later, and Tzuo’s concerned that there’s still not enough urgency. Naturally, he has a solution:
Tzuo suggested it might get more attention from companies if it had a catchier name.
“When we say things like ASC 606, the problem is you just don’t have an Enron, a Y2K,” he said. “ASC 606? I don’t know what you’re saying. We’ve got to give this thing a sexier name. It should be called ASC 666.”
I think he’s onto something. Giving anything an END TIMES twist will always get people’s attention. Just look at all the press this quack is getting for saying that “the beginning of the end of the world as we know it” will commence on Saturday. If he’s right maybe FASB will call the whole thing off. No one is going to care about the deliverability of a contract if the Tribulation is going on.
Image: William Blake/Public Domain