Skip to content Menu

NACUBO Issues Guidance on Tuition Revenue Recognition

2/13/2019

NACUBO has issued Accounting Advisory 19-01, FASB ASC 606, Revenue From Contracts with Customers: Tuition Revenue. The advisory uses tuition to illustrate concepts in Accounting Standards Codification (ASC) Topic 606 and asserts that a student’s signed financial responsibility agreement (or similar contract) entitles an institution to consideration, in exchange for promised services, on the payment due date. Consequently, an institution has a receivable for promised services on the date that payment is due on signed contractual agreements with students.  

The advisory explains new terms and requirements such as:

  • Performance obligations.
  • Transaction price.
  • Consideration payable to a customer (student financial aid).
  • Variable consideration.
  • Contract assets.
  • Contract liabilities.
  • Portfolio approach.
  • Receivable recognition.

The advisory also provides detailed accounting examples and addresses financial statement disclosures.

Contact

Sue Menditto

Senior Director, Accounting Policy

202.861.2542

Related Content

GASB Proposal Would Update Guidance

GASB’s latest exposure draft would provide new implementation guidance for leases, subscription-based information technology arrangements, and accounting changes and error corrections. Comments are due January 20, 2023.

NACUBO Answers Common Questions on New Tuition Discounting Methodology

During NACUBO’s recent Town Halls about our updated guidance for estimating and reporting discounts on tuition and auxiliary services, several topics came up and are addressed in a new Q&A document.

HEERF 2023 Annual Reporting Opens in March

The reporting period for the 2023 HEERF annual report (covering calendar year 2022) is scheduled to begin on March 6, 2023, and will run through March 24, 2023. There are numerous notable changes from last year’s reporting.