With SEC Comment Letter data from the CompanyIQ^® databse, this report looks at ASC 606 compliance.

There are nearly 600 codification references of ASC 606 (and related ASC 340-40) in over 430 comments covering a broad range of issues. Just over 180 unique Companies have engaged in a total of 225 conversations (i.e. a few had more than one round) via the comment letter process. SEC staff comment letters behold a goldmine of information with detailed documented conversations between Company management and the SEC staff. There are now two years of conversations, some visibly long, and almost 50 percent of comment responses concluded with the Company saying they will amend/clarify language in future filings. Responses generally provide “draft” example wording.

The rate of comments really steepened in the second half of 2018. Here are a few observations from the population of SEC comment letters related to ASC 606 through Feb 9, 2019. I say Feb 9, but really Dec 22, 2018…pencils down during the government shutdown.

Sparing no stubby pencils or digital ink, the SEC staff has issued comment letters to over 180 “unique” companies in the last two years related to ASC 606.