606 & 842 – Why These Numbers Should Have Your Attention

Private companies using accrual accounting must prepare for two key accounting standards: ASC 606 for revenue recognition and ASC 842 for lease accounting. ASC 606 impacts how companies recognize revenue, especially in industries like healthcare and SaaS. ASC 842 requires companies to report operating leases as liabilities on the balance sheet, increasing financial transparency. Both standards have significant implications for private companies and require careful attention to compliance.