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i need someone to explain IFRS15 for me

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November 6th 2015 AN ACCA USER 120 Points

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November 9th 2015 AN ACCA USER 480 Points
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IFRS-15 has 5 pillars.
1. Identify contract
2. Identify Performance Obligations
3. Identify Transaction price
4. Allocate transaction price
5. Recognize revenue on the basis of transaction price
Explanation:
1. We see the legal form of contract.
2. There can be more than one performance obligations in a contract. For Example: An entity selling goods with repairs services.
3. Identify the transaction price at which goods or services are being sold or delivered.
4. This point eliminates the concept of IAS-11 Construction Contracts which says to recognize revenue over the life of the contract. IFRS-15 says:
. 1. Recognize the revenue over the life of the contract only when construction services are being delivered to a single owner i.e: Building a house for an owner.
. 2. Recognize revenue only when the property under construction is transferred to their owners i.e: Building number of flats for number of people, recognize revenue when the flats have been completely built and in actual transferred to the buyers.
5. After all the above 4 conditions have been met finally recognize revenue on the basis of transaction price.

November 10th 2015 AN ACCA USER 940 Points
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