AKAO 2017 Annual Report

116 The following potentially dilutive securities outstanding have been excluded from diluted net loss per share, because their effect would be antidilutive, as of December 31, 2017, 2016 and 2015: December 31, 2017 2016 2015 Options to purchase common stock................................................ 4,838,598 3,540,293 2,387,337 Restricted stock units...................................................................... 891,232 605,052 372,024 Warrants to purchase common stock.............................................. 1,196,296 1,322,754 30,024 Recent Accounting Pronouncements In February 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-02, Leases , which, for operating leases, requires a lessee to recognize a right-of-use asset and a lease liability, initially measured at the present value of the lease payments, in its balance sheet. The standard also requires a lessee to recognize a single lease cost, calculated so that the cost of the lease is allocated over the lease term, on a generally straight-line basis. This ASU will be effective for the Company in fiscal year 2019. Early adoption is permitted. The Company is currently assessing the potential effects of this ASU on its consolidated financial statements. In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606), which provides a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and will supersede most current revenue recognition guidance. This ASU is based on the principle that revenue is recognized to depict the transfer of goods or services to customers in an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods or services. This ASU defines a five-step process to achieve this core principle and, in doing so, it is possible more judgment and estimates may be required within the revenue recognition process than are required under existing GAAP. The Company expects to adopt the new revenue standard as of January 1, 2018 using the modified retrospective method. The Company has completed its assessment and determined that its government contracts and non-profit foundation grant are not in scope of ASC 606 and there is no impact on its consolidated financial statements. In March 2016, the FASB issued ASU No 2016-09, Compensation - Stock Compensation (Topic 718) - Improvements to Employee Share-Based Payment Accounting . This ASU simplifies the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. In addition, the guidance allows for a policy election to account for forfeitures as they occur rather than on an estimated basis. This ASU will be effective for fiscal years beginning after December 15, 2016, including interim periods. The Company adopted this ASU effective January 1, 2017 and elected to account for forfeitures on an estimated basis. The adoption had no impact on the Company’s consolidated financial statements. In May 2017, the FASB issued ASU No. 2017-09, Compensation – Stock Compensation (Topic 718): Scope of Modification Accounting . This ASU provides guidance about which changes to the terms or conditions of a share- based payment award require the Company to apply modification accounting. This ASU will be effective for the Company for annual reporting periods, including interim reporting periods, beginning after December 15, 2017. Early adoption is permitted. The Company is currently assessing the potential effects of this ASU on its consolidated financial statements.