Share this content

Please explain SAB 101 and SAB 104

Where can I quickly (over the net, or email if possible) obtain a potted summary explanation, of say 1 to 2 pages, of SAB 101 and SAB 104.

Or would someone be kind enough to let me know in their own words.

Many grateful thanks

Michael Ung


Please login or register to join the discussion.

James - thank you
The industry is advertising and related production work, but you have given me a good idea of where the SAB is coming from.


Thanks (0)

A brief summary....
SAB 104 gives specific pointers for revenue recognition. These are SEC guidance and are therefore of most relevance to US listed companies (and their subsidiaries).

SAB 104 requires that where specific authoritive literature about revenue recognition exists, it should be followed (such as SOP97-2 covering software recognition).

Otherwise revenue should not be recognized until it is either earned or realised (or realisable.)

Basically, four "tests" must be met: there must be persuasive evidence that an arrangement exists; delivery must have occurred; the consideration must be fixed or determinable; collectibility of the debt must be probable.

SAB 101 was superseded by SAB 104 in December 2003.

It might be worth expanding the initial question to indicate the industry/particular areas of interest...

Thanks (0)

Google is a good place to start

SAB 101 is the US Securities & Exchange Commission's Staff Accounting Bulletin on revenue recognition, published in 1999. It's the first result that comes up on Google - and the full text is available online.

It's quite a large, complex document. If you only really want a few lines, an FAQ that accompanies the bulletin explains: "SAB 101 identifies four essential criteria that should be met before product revenue can be recognized. One of the criteria is that delivery has occurred... A necessary element of the delivery of a tangible product is the transfer of its title."

Hope this helps to get you started.

John Stokdyk

Thanks (0)

You read my mind..........
John thanks.

My 1st request was indeed prompted by by visit to Google, saw the reams of detail, when what I really needed a potted appreciation. Perhaps one does not exist?

We'll see.

Thanks (0)

I suspected as much...
Sorry Mike. I was hoping the FAQ would distil some of the essence for you. Do you really need the chapter & verse of SAB 101 and 104 (haven't checked what it covers? The SEC's thinking heavily influenced the UK ASB when it tackled revenue recognition. If you can find their 2001 discussion paper at, you might find a nice precis. And I think there might be something buried in the vaults of AccountingWEB. I just hvaen't been able to find it yet.

John Stokdyk

Thanks (0)