On January 1, 2018, the Company adopted Accounting Standards Codification Topic 606 – “Revenue from Contracts with Customers” (“ASC 606”), using the modified retrospective method. Results for reporting periods beginning after January 1, 2018 are presented under the new revenue recognition standard, while prior period amounts are not adjusted and continue to be reported under the accounting standards in effect for the prior periods.

 

The Company recorded a net decrease to opening accumulated deficit of $0.1 million as of January 1, 2018 due to the cumulative impact of adopting ASC 606, with the impact primarily related to the licensing of our restaurants and the amortization of fees associated with our license agreements. The changes were as follows (in thousands):

 

 

Under ASC 606, the Company has determined that the services it provides under its licensing agreements are primarily for initial license fees and upfront fees and do not contain separate and distinct performance obligations from the license right; therefore, these fees will be recognized on a straight-line basis over the term of the license agreement. Under previous guidance, initial license fees were recognized when the related services had been provided, which was generally upon the opening of the restaurant, and upfront fees were recognized on a pro-rata basis as restaurants under the development agreement were opened. These fees will continue to be recorded as a component of management, license and incentive fee revenue on the consolidated statement of operations and comprehensive (loss) income. ASC 606 requires sales-based royalties to continue to be recognized as licensee restaurant sales occur.

 

The impact of adopting ASC 606 as compared to the previous recognition guidance on our consolidated statement of operations and comprehensive (loss) income was as follows (in thousands):

 

 

The following table provides information about receivables and contract liabilities (deferred license fees) from contracts with customers (in thousands):

 

 

 

Significant changes in deferred license fees are as follows (in thousands):

 

 

The following table reflects the estimated license fees to be recognized in the future related to performance obligations that are unsatisfied as of September 30, 2018 (in thousands):