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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.


Sue Menditto

Senior Director, Accounting Policy


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