Research On Revenue RecognitionUnder New Economy

New economy has challenged accounting for revenue recognition to a great extent. Lifetime obligations, a great number of reversible transactions, barter transactions on internet, multiple-elements arrangements is booming. Under new economy revenue recognition is becoming more and more aggressive in recent years. To resolve the challenges, there are two viewpoints. One is the traditional income statement is value-irrelevant and should be eliminated. Then, it is nonsense to research accounting for revenue recognition. The other is to improve the reliability of income, including revenue of course, and in result to improve the relevance of the income statement. This paper tries to research revenue-recognition problems under new economy on the basis of the second viewpoint.At first, the reconciliation of conflicts among the financial accounting conceptual framework is carried out because the conflicts have ruined the foundation of revenue recognition. The paper concludes that the nonarticulation view can resolve the conflicts. And the nonarticulation view can also help resolve the challenges from new economy because it views the realization principle as one of basic accounting principles.Also, the redefinition of realization is made. The paper redefines realization in two dimensions. They are measurability of assets from transactions relevant to revenue and significance of earning-process events. The methodology is applied to the circumstances of lifetime obligations, a great number of reversible transactions, barter transactions on internet and multiple-elements arrangements. Although revenues are aggressive under new economy, it is not advisable to restrict the observable boundary of realization and defer revenue extremely. Conservatism insures one aspect of reliability-certainty of cash flows from revenue transactions, while does harm to the other aspect of reliability-faithful representation of revenue. In conclusion, it is a objective way for solve aggressive revenue-recognition to define realization to a proper scope, not too loose and not too rigid.