Guidelines
- If all 6 not met the sale should be recognized when the return privilege expires or all 6 are subsequently met, whichever is earlier. What the criteria have in common is the degree of certainty.
- Sale with buybacks
- Substance over form prevails
- Essentially a repurchase and financing arrangement.
- Trade Loading
- Wholesalers, shipping prematurely.
- Channel Stuffing (computer industry)
- Potential for income manipulation.
- Perform cutoff tests.