| Summary of Significant Accounting Policies | 2. Summary
of Significant Accounting Policies Principles
of Consolidation The
accompanying consolidated financial statements include the financial statements of Second Sight and Second Sight Switzerland.
Intercompany balances and transactions have been eliminated in consolidation. Accounts
receivable Trade
accounts receivable are stated net of an allowance for doubtful accounts. The Company performs ongoing credit evaluations of its
customers’ financial condition and generally requires no collateral from its customers or interest on past due amounts.
Management estimates the allowance for doubtful accounts based on review and analysis of specific customer balances that may not
be collectible and how recently payments have been received. Accounts are considered for write-off when they become past due and
when it is determined that the probability of collection is remote. Allowance for doubtful accounts amounted to approximately
$213,000 at December 31, 2016. There was no allowance for doubtful accounts at December 31, 2015. Inventories Inventories
are stated at the lower of cost or market, determined by the first-in, first-out method. Inventories consist primarily of raw
materials, work in progress and finished goods, which includes all direct material, labor and other overhead costs. The Company
establishes a reserve to mark down its inventory for estimated unmarketable inventory equal to the difference between the cost
of inventory and the estimated net realizable value based on assumptions about the usability of the inventory, future demand and
market conditions. If actual market conditions are less favorable than those projected by management, additional inventory reserve
may be required. Property
and Equipment Property
and equipment are recorded at historical cost less accumulated depreciation and amortization. Improvements are capitalized, while
expenditures for maintenance and repairs are charged to expense as incurred. Upon disposal of depreciable property, the appropriate
property accounts are reduced by the related costs and accumulated depreciation. The resulting gains and losses are reflected
in the consolidated statements of operations. Depreciation
is provided for using the straight-line method in amounts sufficient to relate the cost of assets to operations over their estimated
service lives. Leasehold improvements are amortized over the shorter of the life of the asset or the related lease term. Estimated
useful lives of the principal classes of assets are as follows:
Lab
equipment 5 – 7 years
Computer hardware and software 3 – 7 years
Leasehold improvements 2 – 5 years or the term of the lease,
if shorter
Furniture, fixtures and equipment 5 – 10 years The
Company reviews its property and equipment for impairment annually or whenever events or changes in circumstances indicate that
the carrying value of such assets may not be recoverable. There were no impairment losses recognized in 2016, 2015, and 2014. Depreciation
and amortization of property and equipment amounted to $432,000, $335,000 and $279,000 for the years ended December 31, 2016,
2015 and 2014, respectively. Research
and Development Research
and development costs are charged to operations in the period incurred and amounted to $5.3 million, $3.0 million and $5.0 million
net of grant revenue, for the years ended December 31, 2016, 2015 and 2014, respectively. Patent
Costs The
Company has 381 domestic and foreign patents at December 31, 2016. Due to the uncertainty associated with the successful development
of one or more commercially viable products based on Company’s research efforts and any related patent applications, all
patent costs, including patent-related legal, filing fees and other costs, including internally generated costs, are expensed
as incurred. Patent costs were $652,000, $679,000 and $666,000 for the years ended December 31, 2016, 2015 and 2014, respectively,
and are included in general and administrative expenses in the consolidated statements of operations. Revenue
Recognition The
Company’s revenue is derived primarily from the sale of its Argus II retinal implant, which is implanted during retinal
surgery to restore some functional vision to patients blinded by Retinitis Pigmentosa. The Company sells to a variety of customers
including university hospitals, large medical centers and distributors. Revenue
is recognized when persuasive evidence of an arrangement exists, the fee is fixed or determinable, collectability is probable,
and delivery has occurred. Revenue
is generated under sales agreements with multiple deliverables (multiple-element arrangements), comprising the following deliverables:
Hospital start up
kits (one per site),
Surgical support,
Training, and
The Argus II System The
deliverables may vary by transaction. The
Company evaluates each deliverable in a multiple-element arrangement to determine whether it represents a separate unit of accounting.
An element constitutes a separate unit of accounting when the delivered item has standalone value and delivery of the undelivered
element is probable and within the Company's control. The Company has determined that the elements listed above do not have standalone
value to the customer until delivery of all components has occurred. Accordingly, revenue from multiple-element arrangements
is recognized when delivery of all of deliverables has taken place and all other revenue recognition criteria have been met.
Generally, revenue recognition occurs at the time of implantation, but revenue recognition can be delayed if certain training
has not been delivered to the implanting sites, or if other revenue recognition criteria have not been met. In
the United States, the amount of revenue recognized per unit has been limited in some situations due to the uncertainties of the
reimbursement environment and payment terms. In such cases, revenue is not recognized until the consideration becomes fixed, generally
when paid to the Company. In
order to determine whether collection is reasonably assured, the Company assesses a number of factors, including creditworthiness
of the customer and medical insurance coverage. The Company may periodically grant extended payment terms to customers. In such
situations, the Company defers the recognition of revenue until collection becomes probable, which is generally upon receipt of
payment. The
Company also sells surgical supplies to customers and recognizes revenue on these products when they are shipped and other revenue
recognition criteria have been met. The
Company sells through distributors in certain countries. The Company provides these distributors with clinical start-up
kits, surgical supplies and the Argus II System, as well as training them to provide pre- and post-surgical support. The
Company monitors the surgery. Other than surgical support which is provided by the Company, the distributor is responsible for
delivering products and services to its customers. In the past, the Company has allowed distributors to return or exchange
products in certain situations. Due to the Company’s continuing involvement and its returns policy, the Company recognizes
revenue from distributors when the implantation procedure has been performed by the distributor’s customer, and all other
revenue recognition criteria between the Company and the distributor have been met. Grant
Receipts and Liabilities From
time to time, the Company receives grants that help fund specific development programs. Any amounts received pursuant to grants
are offset against the related operating expenses as the costs are incurred. During the years ended December 31, 2016, 2015
and 2014 grants offset against operating expenses were $2,366,000, $1,878,000 and $19,000, respectively. Use
of Estimates The
preparation of financial statements in conformity with accounting principles generally accepted in the United States requires
management to make estimates and assumptions. These estimates and assumptions affect the reported amounts of assets and liabilities,
disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and
expenses during the reporting period. Actual amounts could differ materially from those estimates. Concentration
of Risk Credit
Risk Financial
instruments that subject the Company to concentrations of credit risk consist primarily of cash, money market funds, and trade
accounts receivable. The Company maintains cash and money market funds with financial institutions that management deems reputable,
and at times, cash balances may be in excess of FDIC and SIPC insurance limits of $250,000 and $500,000 (including cash of $250,000),
respectively. The Company extends differing levels of credit to customers, and typically does not require collateral. The
Company also maintains a cash balance at a bank in Switzerland. Accounts at such bank are insured up to an amount specified by
the deposit insurance agency of Switzerland. Customer
Concentration During
the years ended December 31, 2016, 2015 and 2014, the following customers comprised more than 10% of revenues :
2016 2015 2014
Customer
1 13 % 14 % 7 %
Customer
2 3 % 4 % 10 %
Customer
3 2 % 7 % 21 % As
of December 31, 2016 and 2015, the following customers comprised more than 10% accounts receivable:
2016 2015
Customer
1 34 % 1 %
Customer
2 34 % 0 %
Customer
3 29 % 0 %
Customer
4 0 % 19 %
Customer
5 0 % 17 %
Customer
6 0 % 10 %
Customer
7 0 % 10 %
Customer
8 0 % 10 % Geographic
Concentration During
the years ended December 31, 2016, 2015 and 2014, regional revenue, based on customer locations which comprised more than 10%
of revenues, consisted of the following:
2016 2015 2014
United
States 47 % 46 % 47 %
Italy 17 % 20 % 8 %
Germany 12 % 6 % 16 %
France 9 % 16 % 3 %
Canada 3 % 5 % 10 % Sources
of Supply Several
of the components, materials and services used in the Company’s current Argus II product are available from only one supplier,
and substitutes for these items cannot be obtained easily or would require substantial design or manufacturing modifications.
Any significant problem experienced by one of the Company’s sole source suppliers could result in a delay or interruption
in the supply of components to the Company until that supplier cures the problem or an alternative source of the component is
located and qualified. Even where the Company could qualify alternative suppliers, the substitution of suppliers may be at a higher
cost and cause time delays that impede the commercial production of the Argus II, reduce gross profit margins and impact the Company’s
abilities to deliver its products as may be timely required to meet demand. Foreign
Operations The
accompanying consolidated financial statements as of December 31, 2016 and 2015 include assets amounting to approximately $1.7
million and $3.0 million, respectively, relating to operations of the Company in Switzerland. It is always possible unanticipated
events in foreign countries could disrupt the Company’s operations. Fair
Value of Financial Instruments The
authoritative guidance with respect to fair value establishes a fair value hierarchy that prioritizes the inputs to valuation
techniques used to measure fair value into three levels, and requires that assets and liabilities carried at fair value be classified
and disclosed in one of three categories, as presented below. Disclosure as to transfers in and out of Levels 1 and 2, and activity
in Level 3 fair value measurements, is also required. Level
1. Observable inputs such as quoted prices in active markets for an identical asset or liability that the Company has the ability
to access as of the measurement date. Financial assets and liabilities utilizing Level 1 inputs include active-exchange traded
securities and exchange-based derivatives. Level
2. Inputs, other than quoted prices included within Level 1, which are directly observable for the asset or liability or indirectly
observable through corroboration with observable market data. Financial assets and liabilities utilizing Level 2 inputs include
fixed income securities, non-exchange based derivatives, mutual funds, and fair-value hedges. Level
3. Unobservable inputs in which there is little or no market data for the asset or liability which requires the reporting entity
to develop its own assumptions. Financial assets and liabilities utilizing Level 3 inputs include infrequently-traded non-exchange-based
derivatives and commingled investment funds, and are measured using present value pricing models. The
Company determines the level in the fair value hierarchy within which each fair value measurement falls in its entirety, based
on the lowest level input that is significant to the fair value measurement in its entirety. In determining the appropriate levels,
the Company performs an analysis of the assets and liabilities at each reporting period end. Money
market funds are the only financial instrument that is measured and recorded at fair value on the Company’s balance sheet,
and they are considered Level 1 valuation securities in both 2016 and 2015. Stock-Based
Compensation Pursuant
to Financial Accounting Standards Board (“FASB”) ASC 718 Share-Based Payment (“ASC 718”), the Company
records stock-based compensation expense for all stock-based awards. Under
ASC 718, the Company estimates the fair value of stock options granted using the Black-Scholes option pricing model. The fair
value for awards that are expected to vest is then amortized on a straight-line basis over the requisite service period of the
award, which is generally the option vesting term. The
fair value of each stock option award is estimated on the date of grant using the Black-Scholes option valuation model. The assumptions
used in the Black-Scholes valuation model are as follows:
The grant price
of the issuances, is determined based on the fair value of the shares at the date of grant.
The risk free interest
rate for periods within the contractual life of the option is based on the U.S. treasury yield in effect at the time of grant.
As permitted by
SAB 107, due to the Company’s insufficient history of option activity, management utilizes the simplified approach to
estimate the options expected term, which represents the period of time that options granted are expected to be outstanding.
Volatility is determined
based on average historical volatilities of comparable companies in similar industry.
Expected dividend
yield is based on current yield at the grant date or the average dividend yield over the historical period. The Company has
never declared or paid dividends and has no plans to do so in the foreseeable future. Long
Term Investor Right Each
beneficial owner (“IPO Shareholder”) of the Company’s common stock, who purchased shares directly in the offering
(“IPO Shares”), was eligible to receive up to one additional share of common stock from the Company for each share
purchased in the offering (“IPO Supplemental Shares”) pursuant to the Long Term Investor Right that was included with
each IPO Share. To receive IPO Supplemental Shares, within 90 days following the closing date of the offering, or by February
22, 2015, an IPO Shareholder was required to take action to become the direct registered owner of its IPO Shares. Furthermore,
IPO Shareholders were required to hold their IPO Shares in their own name and not place them in “street name” or trade
them at any time during the 24 month period immediately following the IPO closing date. This Long Term Investors Right was non-detachable
and transferable only in limited circumstances. The
Company issued IPO Supplemental Shares to IPO Shareholders who did not otherwise forfeit their Long Term Investor Right since,
during the two-year period immediately following the IPO closing date, the Company’s common stock did not trade at or above
$18.00 per share (200% of the IPO price per share) for any five consecutive day period. If the Company’s common stock had
traded on its principal exchange at 200% of the IPO price per share or greater on five consecutive trading days during the two
years after the IPO closing date, the Long Term Investor Right would have terminated. The
formula to determine the number of IPO Supplemental Shares issued on a trigger of the Long Term Investor Right was: (i) $18.00
minus (ii) the average of the highest consecutive closing prices in any 90 day trading period on the principal exchange during
the two years after the Closing Date (the “Measurement Average”) divided by the Measurement Average. Fractional shares
issuable to a qualifying IPO Shareholder resulting from the calculation were rounded up to the next whole share of Common Stock,
taking into account the aggregate number of Long Term Investor Rights of a holder. Since the highest average of consecutive closing
prices over any 90 calendar day period was $13.96 per share, each Long-Term Investor Right was entitled to 0.2894 additional shares
of common stock, which is calculated as: ($18.00 - $13.96)/$13.96. The
amount of IPO Supplemental Shares issued was computed by an independent public accountant as soon as practicable following the
second anniversary of the Closing Date. The determination was made by such independent public accountant and all qualifying IPO
Shareholders had certificates evidencing the additional shares delivered to them totaling 355,095 shares. The
Long Term Investor Right was an equity instrument that was accounted for as a component of the actual price per common share paid
by the investor in the IPO. For basic earnings per share, the common shares associated with the Long Term Investor Right were
treated as contingently issuable shares and were not included in basic earnings per share until the actual number of shares were
issued which occurred in November 2016. Convertible
Promissory Notes and Warrants Warrants
and embedded beneficial conversion feature of convertible promissory notes are classified as equity under FASB ASC Topic 815-40
“Derivatives and Hedging — Contracts in Entity’s Own Equity”. The Company allocates the proceeds of the
convertible promissory notes between convertible promissory notes and the financial instruments related to warrants associated
with convertible promissory notes based on their relative fair values at the commitment date. The fair value of the financial
instruments related to warrants associated with convertible promissory notes is determined utilizing the Black-Scholes option
pricing model and the respective allocated proceeds to the warrants is recorded in additional paid-in capital. The Company utilized
the Black-Scholes option valuation model using the same valuation assumptions as described herein for Stock Based Compensation.
The embedded beneficial conversion feature associated with convertible promissory notes is recognized and measured by allocating
a portion of the proceeds equal to the intrinsic value of that feature to additional paid-in capital in accordance with ASC Topic
470-20 “Debt — Debt with Conversion and Other Options.” The portion of debt discount resulting from the allocation
of proceeds to the financial instruments related to warrants associated with convertible promissory notes is being amortized over
the life of the convertible promissory notes. That portion of debt discount resulting from the allocation of proceeds to the beneficial
conversion feature is amortized over the term of the notes from the respective dates of issuance. Comprehensive
Income or Loss The
Company complies with provisions of FASB ASC 220, Comprehensive Income, which requires companies to report all changes in equity
during a period, except those resulting from investment by owners and distributions to owners, for the period in which they are
recognized. Comprehensive income is defined as the change in equity during a period from transactions and other events from non-owner
sources. Comprehensive
and other comprehensive income (loss) is reported on the face of the financial statements. For the years ended December 31, 2016,
2015 and 2014 comprehensive income (loss) is the total of net income (loss) and other comprehensive income (loss) which, for the
Company, consists entirely of foreign currency translation adjustments and there were no material reclassifications from other
comprehensive loss to net loss during the years ended December 31, 2016, 2015 and 2014. Foreign
Currency Translation and Transactions The
financial statements and transactions of the subsidiary’s operations are reported in the local (functional) currency of
Swiss francs (CHF) and translated into US dollars in accordance with U.S. GAAP. Assets and liabilities of those operations are
translated at exchange rates in effect at the balance sheet date. The resulting gains and losses from translating foreign currency
financial statements are recorded as other comprehensive income (loss). Revenues and expenses are translated at the average exchange
rate for the reporting period. Foreign currency transaction gains (losses) resulting from exchange rate fluctuations on transactions
denominated in a currency other than the foreign operations’ functional currencies are included in expenses in the consolidated
statements of operations. Income
Taxes The
Company accounts for income taxes under an asset and liability approach for financial accounting and reporting for income taxes.
Accordingly, the Company recognizes deferred tax assets and liabilities for the expected impact of differences between the financial
statements and the tax basis of assets and liabilities. The
Company records a valuation allowance to reduce its deferred tax assets to the amount that is more likely than not to be realized.
In the event the Company was to determine that it would be able to realize its deferred tax assets in the future in excess of
its recorded amount, an adjustment to the deferred tax assets would be credited to operations in the period such determination
was made. Likewise, should the Company determine that it would not be able to realize all or part of its deferred tax assets in
the future, an adjustment to the deferred tax assets would be charged to operations in the period such determination was made.
The Company has incurred losses for tax purposes since inception and has significant tax losses and tax credit carryforwards.
These amounts are subject to valuation allowances as it is not likely that they will be realized in the next few years. Product
Warranties The
Company’s policy is to warrant all shipped products against defects in materials and workmanship for up to two years by
replacing failed parts. The Company also provides a three-year manufacturer’s warranty covering implant failure by providing
a functionally-equivalent replacement implant. Accruals for product warranties are estimated based on historical warranty experience
and current product performance trends, and are recorded at the time revenue is recognized as a component of cost of sales. The
warranty liabilities are reduced by material and labor costs used to replace parts over the warranty period in the periods in
which the costs are incurred. The Company periodically assesses the adequacy of its recorded warranty liabilities and adjusts
the amounts as necessary. Although any such adjustments were not material in the years ended December 31, 2016, 2015 and 2014,
any such adjustments could be material in the future if estimates differ significantly from actual warranty expense. The warranty
liabilities are included in accrued expenses in the consolidated balance sheets. Presentation
of sales and value added taxes The
Company collects value added tax on its sales in Europe and certain states in the United Sates impose a sales tax on the Company’s
sales to nonexempt customers. The Company collects that valued added and sales tax from customers and remits the entire amount
to the respective authorities. The Company’s accounting policy is to exclude the tax collected and remitted to the authorities
from revenues and cost of revenues. Net
Loss per Share The
Company’s computation of earnings per share (“EPS”) includes basic and diluted EPS. Basic EPS is measured as
the income (loss) available to common shareholders divided by the weighted average number of common shares outstanding for the
period. Diluted EPS is similar to basic EPS but presents the dilutive effect on a per share basis of potential common shares (e.g., convertible
notes payable, convertible preferred stock, preferred stock warrants and common stock options) as if they had been converted at
the beginning of the periods presented, or issuance date, if later. Potential common shares that have an anti-dilutive effect
(i.e., those that increase income per share or decrease loss per share) are excluded from the calculation of diluted EPS. Loss
per common share is computed by dividing net loss by the weighted average number of shares of common stock outstanding during
the respective periods. Basic and diluted loss per common share is the same for all periods presented because all convertible
notes payable, common stock warrants and common stock options outstanding were anti-dilutive. At
December 31, 2016, 2015 and 2014, the Company excluded the outstanding securities summarized below, which entitle the holders
thereof to ultimately acquire shares of common stock, from its calculation of earnings per share, as their effect would have been
anti-dilutive (in thousands).
2016 2015 2014
Long
Term Investor Rights — 400 1,021
Underwriter’s
warrants 802 802 805
Warrants
associated with convertible debt 1,039 1,039 1,179
Common
stock options 3,667 3,472 3,251
Restricted
stock units 131 190 —
Employee
stock purchase plan 206 93 —
Total 5,845 5,996 6,256 Recently
Adopted Accounting Standards In
August 2014, the FASB issued Accounting Standards Update No. 2014-15 (ASU 2014-15), Presentation of Financial Statements —
Going Concern (Subtopic 205-10). ASU 2014-15 provided guidance as to management’s responsibility to evaluate whether there
is substantial doubt about an entity’s ability to continue as a going concern and to provide related footnote disclosures.
In connection with preparing these financial statement management evaluated whether there are conditions or events, considered
in the aggregate, that raise substantial doubt about the Company’s ability to continue as a going concern within one year
after the date that the financial statements are issued. As fully described in Note 1, the Company believes that it does not have
sufficient funds to support its operations through the end of first quarter of 2018. Recent
Accounting Pronouncements In
November 2015, the FASB issued Accounting Standards Update No. 2015-17 (ASU 2015-17), Income Taxes (Topic 740): Balance Sheet
Classification of Deferred Taxes. ASU 2015-17 requires that deferred tax liabilities and assets be classified as noncurrent in
a classified statement of financial position. ASU 2015-17 is effective for financial statements issued for annual periods beginning
after December 15, 2016, and interim periods within those annual periods. Earlier application is permitted as of the beginning
of an interim or annual reporting period. The adoption of ASU 2015-17 is not expected to have any impact on Company’s financial
statement presentation or disclosures. In
February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), which supersedes all existing guidance on accounting for leases
in ASC Topic 840. ASU 2016-02 is intended to provide enhanced transparency and comparability by requiring lessees to record
right-of-use assets and corresponding lease liabilities on the balance sheet. ASU 2016-02 will continue to classify leases
as either finance or operating, with classification affecting the pattern of expense recognition in the statement of income.
ASU 2016-02 is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years.
Early adoption is permitted. ASU 2016-02 is required to be applied with a modified retrospective approach to each prior
reporting period presented with various optional practical expedients. We are currently assessing the potential impact of
adopting ASU 2016-02 on our financial statements and related disclosures. In
March 2016, the FASB issued ASU 2016-09, Compensation—Stock Compensation (Topic 718): Improvements to Employee Share-Based
Payment Accounting. ASU 2016-09 changes how companies account for certain aspects of share-based payment awards to employees,
including the accounting for income taxes, forfeitures and statutory tax withholding requirements, as well as classification in
the statement of cash flows. ASU 2016-09 is effective for annual periods beginning after December 15, 2016, including interim
periods within those annual periods. If an entity early adopts in an interim period, any adjustments should be reflected
as of the beginning of the fiscal year that includes that interim period and the entity must adopt all of the amendments from
ASU 2016-09 in the same period. Management has determined that the impact of this standard when adopted in 2017 will not
be material to the financial statements and related disclosures. In
August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash
Payments. ASU 2016-15 refines how companies classify certain aspects of the cash flow statement in regards to debt prepayment,
settlement of debt instruments, contingent consideration payments, proceeds from insurance claims and life insurance policies,
distribution from equity method investees, beneficial interests in securitization transactions and separately identifiable cash
flows. ASU 2016-15 is effective for annual periods beginning after December 15, 2017, and interim periods within those fiscal
years. No early adoption is permitted. Management is currently assessing the potential impact of adopting ASU 2016-15
on the financial statements and related disclosures. In
October 2016, the FASB issued ASU No. 2016-16, Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory,
which reduces the complexity in the accounting standards by allowing the recognition of current and deferred income taxes for
an intra-entity asset transfer, other than inventory, when the transfer occurs. Historically, recognition of the income
tax consequence was not recognized until the asset was sold to an outside party. This amendment should be applied on a modified
retrospective basis through a cumulative-effect adjustment directly to retained earnings as of the beginning of the period of
adoption. ASU 2016-16 is effective for annual periods beginning after December 15, 2017, including interim reporting periods
within those annual reporting periods. Early adoption is permitted for all entities as of the beginning of an annual reporting
period for which financial statements (interim or annual) have not been issued or made available for issuance. That is,
earlier adoption should be in the first interim period if an entity issues interim financial statements. Management is currently
evaluating the impact of ASU 2016-16 on our consolidated financial statements and related disclosures. In
May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”)
No. 2014-09 (ASC 606) - Revenue from Contracts with Customers (“ASU 2014-09”), which provides guidance for revenue
recognition. This ASU will supersede the revenue recognition requirements in Topic 605, and most industry specific guidance. The
standard's core principle is that revenue is recognized when promised goods or services are transferred to customers in an amount
that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. To achieve
that core principle, an entity should apply the following steps: Step
1: Identify the contract(s) with a customer Step
2: Identify the performance obligations in the contract. Step
3: Determine the transaction price. Step
4: Allocate the transaction price to the performance obligations in the contract. Step
5: Recognize revenue when (or as) the entity satisfies a performance obligation. The
guidance in ASU 2014-09 also specifies the accounting for some costs to obtain or fulfill a contract with a customer. ASC 606
requires the Company to make significant judgments and estimates. ASC 606 also requires more extensive disclosures regarding the
nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. The
FASB has also issued several additional ASUs whic |
