The basic principle followed by the SEC in its application of revenue recognition rules, which is set forth in existing accounting literature, is that revenue should not be recognized until it is realized or realizable and earned. The SEC has taken the position that revenue generally is realized or realizable and earned when all of the following criteria are met:

• persuasive evidence of an arrangement exists
• delivery has occurred or services have been rendered
• the seller's price to the buyer is fixed or determinable, and
• collectibility is reasonably assured.

FWIW