Every time a product is sold, the seller earns and reports revenue. However, in the real world such sales transactions are not so simple and the principle of revenue recognition is the one that causes the most problems for accountants. Nowadays the sales process has become quite complex. There are many issues and procedures involved. Customers have the option to make payments immediately at the time of sale, or they can choose to make payment in installments as agreed in the sales contract. There are numerous credit and financing options available. Customers also have guaranteed return days. All of these incentives help make it easier for customers to purchase products while increasing sales for the seller; however, the job of an accountant has become more challenging. Accountants have yet to invent a system that is seamlessly suited to revenue recognition and is compatible across industries. “FEI President and CEO Colleen Cunningham ranks revenue recognition among the top 3 financial reporting issues faced by accountants today. In 2006, an investigation was conducted with the Financial Accounting Standards Advisory Council and the FASB. A majority of members of both organizations believe that finding solutions to revenue recognition problems should be the FASB's top priority. (Graziano 2005).” In this paper, we will discuss some of the challenges and issues surrounding revenue recognition and the procedures put in place by various accounting organizations, including FASB. Accounta...... middle of the paper ...... the most problematic financial reporting topics, winning the votes of many accounting professionals as the No. 1 issue to be addressed by the FASB. While many workarounds are suggested, only time will tell how effectively the FASB will be able to eliminate the problems. References1. Graziano, Cheryl de Mesa. “Revenue Recognition: A Perennial Problem.” Financial Executive Journal (2005)2. Tiller, Mikel G., Jan R. Williams, and “Revenue Recognition Under New FASB Filings.” The CPA Journal 52(1982)3. Clark, Ronald L.. “Revenue – Recognition Decisions: A Slippery Slope?” The CPA Journal (2006)4. Kieso, Donald E. and Jerry J. Weygandt. Intermediate accounting. 11. Wiley, 20045. FASB Statement of Standard No. 48