ASC

ASC 605-940

Financial Services—Brokers and Dealers

605 Revenue Recognition

Download JSONDownload Markdown9 paragraphs · 6 sectionsJump to summary

Source downloaded: .Record version 240cc6a75903. Effective date must be checked in the source.

In brief

IntermediateRevenueIndustry-specificTransition and effective datesRecognition

ASC 605-940 formerly provided industry-specific revenue recognition guidance for brokers and dealers in securities (e.g., trade-date recognition of commissions and related expenses, and measurement of such revenues). Every paragraph in the subtopic — Sections 05, 15, 25 and 30 — was superseded by ASU 2014-09, so the subtopic contains no remaining operative guidance. Broker-dealer revenue from contracts with customers is now accounted for under ASC 606, with related industry implementation guidance in ASC 940-605.

Key points (5)
  • All content of ASC 605-940 (605-940-05-1, 15-1, 25-1 through 25-4, and 30-1 through 30-2) was superseded by Accounting Standards Update No. 2014-09.
  • Because no paragraphs remain, ASC 605-940 imposes no recognition or measurement requirements and cannot be cited as authoritative support.
  • Revenue from contracts with customers earned by brokers and dealers in securities is now recognized under the five-step model in ASC 606-10-05-4, not under legacy industry guidance.
  • Industry-specific implementation guidance for broker-dealer revenue now resides in ASC 940-605 (Financial Services—Brokers and Dealers, Revenue Recognition).
  • Amounts within the scope of other Topics — such as trading gains and losses on financial instruments — remain outside ASC 606 and are addressed under ASC 320, ASC 815, or ASC 940-320.

For students. This subtopic is a shell: its only content is a record that ASU 2014-09 wiped out the legacy broker-dealer revenue rules. The common mistake is citing 605-940 for trade-date commission recognition — go instead to ASC 606 for the model and ASC 940-605 for industry application.

superseded guidancebroker-dealer revenuecommission revenuetrade date accountingrevenue from contracts with customersindustry-specific revenue guidance

Machine-generated study aid for ASC 605-940. Check the source paragraphs below.

605-940-00Status

Source downloaded: .Record version 8684eccd7983. Effective date must be checked in the source.

605-940-00-1
The following table identifies the changes made to this Subtopic.
Paragraph Action Accounting Standards Update Date
Half-Turn Superseded Accounting Standards Update No. 2014-09 05/28/2014
Round-Turn Superseded Accounting Standards Update No. 2014-09 05/28/2014
940-605-05-1 Superseded Accounting Standards Update No. 2014-09 05/28/2014
940-605-15-1 Superseded Accounting Standards Update No. 2014-09 05/28/2014
940-605-25-1 through 25-4
 Superseded Accounting Standards Update No. 2014-09 05/28/2014
940-605-30-1 Superseded Accounting Standards Update No. 2014-09 05/28/2014
940-605-30-2 Superseded Accounting Standards Update No. 2014-09 05/28/2014

605-940-05Overview and Background

Source downloaded: .Record version a637524b69be. Effective date must be checked in the source.

605-940-15Scope and Scope Exceptions

Source downloaded: .Record version 56ce85aeb63e. Effective date must be checked in the source.

605-940-20Glossary

Source downloaded: .Record version bf80daccfc71. Effective date must be checked in the source.

605-940-25Recognition

Source downloaded: .Record version cb6ae506e199. Effective date must be checked in the source.

605-940-30Initial Measurement

Source downloaded: .Record version 17f18fff492a. Effective date must be checked in the source.

Related subtopics