Revenue Recognition at Groupon and Uber Technologies

Name: Revenue Recognition at Groupon and Uber Technologies (English version)
SKU: A-236

Gipper, Brandon L.; Foroughi, Jaclyn

Product #:A-236

Supplier:Stanford University

Discipline:Accounting

Details:Case (PDF) • 28 pages • 2020-11-01

Subjects:

Accounting Accounting standards

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Groupon, a daily deals platform and Uber Technologies, a ride-hailing and delivery platform, faced a common issue related to a new revenue recognition standard (and later amendments) adopted by most public companies in 2018. The amendments were designed to help companies determine whether the nature of their obligation to customers was to provide the specified goods or services to the customer directly (acting as principal and reporting revenues on a gross basis) or to arrange for another party to provide them (acting as agent and reporting revenues on a net basis).

Learning Objectives

1. Understand the economics of new technology platforms that give rise to revenue recognition questions, such as what is revenue for this firm? 2. Become familiar with required financial reporting requirements for gross versus net revenue recognition; principal versus agent considerations. 3. Understand the implications of the Securities and Exchange Commission (SEC) comment process. 4. Consider the potential impact of late restatements and other areas of reporting risk during an IPO.