BackgroundA publicly-traded, leading provider of healthcare software solutions and services for community hospitals, physician clinics, and post-acute care facilities begins the process of determining a path forward with respect to the adoption of ASC 606. The Company’s services include offering a comprehensive electronic healthcare record software solution (both perpetual software and software-as-a-service), as well as professional services related to business management, revenue cycle management, managed information technology and consulting. Management identified complexities within various revenue streams and the need for assistance with adopting the new revenue standard. Paradigm is engaged to assist with the implementation of ASC 606 through collaboration with the Company's management and interaction with the external auditors.
- Performed scoping procedures across all entities to determine the nature of promises to customers and identify categories of revenue streams under the new standard
- Reviewed contracts with customers across all identified revenue streams and evaluated each contract under the five-step model of ASC 606, which included identifying specific revenue streams where a change in the timing of revenue recognition would occur
- Prepared technical memorandums to document the conclusions reached under ASC 606 for the 5 identified revenue streams
- Performed additional evaluation of costs to obtain and costs to fulfill under ASC 340-40 and identified certain costs which met the requirements to be capitalized and deferred over the estimated customer life
- Coordinated review of memos by external auditors and resolution of all issues identified
- Assisted with preparation and review of ASC 606 disclosures for the 10-Q’s during the year of adoption