Technical accounting is the application of complex accounting standards – such as U.S. GAAP and IFRS – to real business transactions.

It focuses on researching and interpreting authoritative guidance, documenting conclusions (often in formal accounting memos), and ensuring financial reporting is accurate, compliant, and defensible – especially for non-routine or judgment-heavy areas like revenue recognition, leases, business combinations, impairments, and stock-based compensation.

Technical accounting helps businesses reduce the risk of misstatements, audit findings, and regulatory issues by ensuring complex transactions are accounted for correctly. It brings clarity where standards require judgment, strengthens management’s positions through clear documentation, and supports smoother audits, financings, IPO readiness, acquisitions, and periods of rapid growth, when scrutiny is highest, and timelines are tight.

Technical accounting commonly covers the most complex or evolving areas of U.S. GAAP and IFRS, including:

• ASC 606 – Revenue Recognition
• ASC 842 – Leases
• ASC 805 – Business Combinations (purchase accounting)
• ASC 350 / ASC 360 – Goodwill and long-lived asset impairment
• ASC 718 – Stock-Based Compensation
• ASC 740 – Income Taxes

…and other topics involving significant estimates, structuring considerations, or frequent standard-setting updates

Technical accounting improves audit readiness by producing well-organized support for key judgments – such as accounting memos, policy documentation, and transaction analyses – that clearly explain the “why” behind conclusions. This reduces audit back-and-forth, shortens timelines, and lowers the risk of late adjustments, control findings, or last-minute surprises during year-end reporting.

Operational accounting is the day-to-day engine: journal entries, reconciliations, close processes, and routine reporting, while Technical accounting focuses on the difficult questions: interpreting standards, evaluating complex transactions, building accounting positions, and documenting conclusions – especially when guidance is nuanced, or facts are unusual

Companies commonly need technical accounting support for:

• Revenue recognition judgments (performance obligations, variable consideration, contract modifications)
• Lease identification, classification, and valuation
• Purchase accounting and transaction-related accounting (acquisitions, earnouts, contingencies)
• Impairment analyses (goodwill, long-lived assets)
• Stock-based compensation valuation and accounting
• Debt accounting (modifications, extinguishments, embedded features)
• New standard adoption and evolving disclosure requirements

These areas tend to involve assumptions and estimates that auditors and regulators scrutinize closely.

ASC 606 (U.S. GAAP) and IFRS 15 are largely converged, but differences can arise in practice, including areas such as:

• Certain contract cost treatment details
• Collectability considerations and thresholds
• Elements of variable consideration and constraint application
• Some presentation and disclosure expectations

Technical accounting helps ensure these differences are addressed consistently – especially for multinational businesses reporting under both frameworks or consolidating across jurisdictions

Typical deliverables include:

• Formal accounting memos/position papers aligned to authoritative guidance
• Transaction analyses and accounting conclusions
• Accounting policy documentation (and updates to existing policies)
• Implementation roadmaps for new standards or process changes
• Audit support packages to streamline auditor review
• Management-ready summaries that translate technical conclusions into business implications.

The goal is documentation that stands up to audit and regulatory review while remaining practical for operators and leadership.

The cost of Technical Accounting services depends on the complexity of transactions, reporting requirements, and the urgency of the task. Engagements are often structured as:

• Project-based fees(common for discrete transactions or implementations), or
• Hourly billing(common for ongoing advisory/support)

In many cases, the cost is materially lower than the potential downstream impact of audit delays, rework, restatements, or regulatory exposure that can result from incorrect or poorly documented accounting conclusions.

Engage a technical accounting specialist when you’re:

• Entering complex or non-routine transactions
• Adopting new accounting standards
• Preparing for an audit (especially first-year audits)
• Raising capital or preparing for IPO readiness
• Completing an acquisition or other strategic transaction
• Experiencing rapid growth, new products, or new contract structures

The earlier technical accounting is involved, the more likely you are to avoid costly fixes later and make decisions with confidence from the start.