What are the similarities and differences between IFRS 15 and U.S. GAAP? Access the PricewaterhouseCoopers website for a comparative analysis. Provide at least 1 potential recommendation to facilitate convergence of revenue recognition.

pter Five Case 5-1 S. A. Harrington Company S. A. Harrington Company is a U.S.-based company that prepares i cordance with U.S. GAAP. The company dated financial statements in accordance with income in 2015 of $5,000,000 and stockholders' equity at December 3 pares its consoli pany reported ber 31, 2015, of and Exchange FRS in preparing ermine the impact and has engaged you y from U.S. GAAP $40,000,000. The CFO of S. A. Harrington has learned that the U.S. Securities and E Commission is considering requiring U.S. companies to use IFRS in consolidated financial statements. The company wishes to determine the that a switch to IFRS would have on its financial statements and has enga to prepare a reconciliation of income and stockholders' equity from US. to IFRS. You have identified the following five areas in which S. A. Harringt accounting principles based on U.S. GAAP differ from IFRS. 1. Restructuring 2. Pension plan 3. Stock options 4. Revenue recognition 5. Bonds payable The CFO provides the following information with respect to each of these accounting differences. Restructuring Provision The company publicly announced a restructuring plan in 2015 that created a valid expectation on the part of the employees to be terminated that the company will carry out the restructuring. The company estimated that the restructuring wouie cost $300,000. No legal obligation to restructure exists as of December 31, 2013 Pension Plan In 2013, the company amended its pension plan, creating a past service 560.000. The past service cost was attributable to already vested employee had an average remaining service life of 15 years. The company has no employees. pany has no retired Stock Options Stock options were granted to key officers on January 1, 2015. The gran value per option was $10, and a total of 9,000 options were granted. I vest in equal installments over three vears: one-third vest in 2014, o 2015, and one-third in 2016. The comp the company uses a straight-line method to re compensation expense related to stock options. Revenue Recognition third in 2016 over three of 9.000 Ontary 1, 2015, 5. The grant date fair Se related company one-third were granted. The granted. The options 4. one-third in to recognize The company entered into a contract in 2015 to provide engineering long-term customer over a 12-month period. The fixed price is $250,00 company estimates with a high degree of reliability that the project complete at the end of 2015. eine Mabilin Ked p ering services to a 250,000, and the Ject is 30 percent International Financial Reporting Standards: Part II 231 Bonds Payable On January 1, 2014, the company issued $10,000,000 of 5 percent bonds at par value that mature in five years on December 31, 2018. Costs incurred in issuing the bonds were $500,000. Interest is paid on the bonds annually. Required Prepare a reconciliation schedule to reconcile 2015 net income and December 31, 2015, stockholders' equity from a U.S. GAAP basis to IFRS. Ignore income taxes. Prepare a note to explain each adjustment made in the reconciliation schedule. pter Five Case 5-1 S. A. Harrington Company S. A. Harrington Company is a U.S.-based company that prepares i cordance with U.S. GAAP. The company dated financial statements in accordance with income in 2015 of $5,000,000 and stockholders' equity at December 3 pares its consoli pany reported ber 31, 2015, of and Exchange FRS in preparing ermine the impact and has engaged you y from U.S. GAAP $40,000,000. The CFO of S. A. Harrington has learned that the U.S. Securities and E Commission is considering requiring U.S. companies to use IFRS in consolidated financial statements. The company wishes to determine the that a switch to IFRS would have on its financial statements and has enga to prepare a reconciliation of income and stockholders' equity from US. to IFRS. You have identified the following five areas in which S. A. Harringt accounting principles based on U.S. GAAP differ from IFRS. 1. Restructuring 2. Pension plan 3. Stock options 4. Revenue recognition 5. Bonds payable The CFO provides the following information with respect to each of these accounting differences. Restructuring Provision The company publicly announced a restructuring plan in 2015 that created a valid expectation on the part of the employees to be terminated that the company will carry out the restructuring. The company estimated that the restructuring wouie cost $300,000. No legal obligation to restructure exists as of December 31, 2013 Pension Plan In 2013, the company amended its pension plan, creating a past service 560.000. The past service cost was attributable to already vested employee had an average remaining service life of 15 years. The company has no employees. pany has no retired Stock Options Stock options were granted to key officers on January 1, 2015. The gran value per option was $10, and a total of 9,000 options were granted. I vest in equal installments over three vears: one-third vest in 2014, o 2015, and one-third in 2016. The comp the company uses a straight-line method to re compensation expense related to stock options. Revenue Recognition third in 2016 over three of 9.000 Ontary 1, 2015, 5. The grant date fair Se related company one-third were granted. The granted. The options 4. one-third in to recognize The company entered into a contract in 2015 to provide engineering long-term customer over a 12-month period. The fixed price is $250,00 company estimates with a high degree of reliability that the project complete at the end of 2015. eine Mabilin Ked p ering services to a 250,000, and the Ject is 30 percent International Financial Reporting Standards: Part II 231 Bonds Payable On January 1, 2014, the company issued $10,000,000 of 5 percent bonds at par value that mature in five years on December 31, 2018. Costs incurred in issuing the bonds were $500,000. Interest is paid on the bonds annually. Required Prepare a reconciliation schedule to reconcile 2015 net income and December 31, 2015, stockholders' equity from a U.S. GAAP basis to IFRS. Ignore income taxes. Prepare a note to explain each adjustment made in the reconciliation schedule