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  • IFRS15 5StepModel Handouts

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    Fred A. Yaansah
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    IFRS 15 establishes principles for reporting useful information to users of financial statements about the nature, amount, timing and uncertainty of revenue and cash flows arising from an entity's contracts with customers. IFRS 15 replaces IAS 18 Revenue, IAS 11 Construction Contracts, and several revenue-related interpretations. It applies to nearly all contracts with customers: the main exceptions are leases, insurance contracts and financial instruments. IFRS 15 introduces a five-step model for revenue recognition that applies to all contracts with customers and will also result in more disclosures in companies' financial statements.

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    IFRS 15 Revenue replace the old IAS18. All you need to know

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    IFRS 15 establishes principles for reporting useful information to users of financial statements about the nature, amount, timing and uncertainty of revenue and cash flows arising from an entity's contracts with customers. IFRS 15 replaces IAS 18 Revenue, IAS 11 Construction Contracts, and several revenue-related interpretations. It applies to nearly all contracts with customers: the main exceptions are leases, insurance contracts and financial instruments. IFRS 15 introduces a five-step model for revenue recognition that applies to all contracts with customers and will also result in more disclosures in companies' financial statements.

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    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
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    29 views3 pages

    IFRS15 5StepModel Handouts

    Uploaded by

    Fred A. Yaansah
    IFRS 15 establishes principles for reporting useful information to users of financial statements about the nature, amount, timing and uncertainty of revenue and cash flows arising from an entity's contracts with customers. IFRS 15 replaces IAS 18 Revenue, IAS 11 Construction Contracts, and several revenue-related interpretations. It applies to nearly all contracts with customers: the main exceptions are leases, insurance contracts and financial instruments. IFRS 15 introduces a five-step model for revenue recognition that applies to all contracts with customers and will also result in more disclosures in companies' financial statements.

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    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
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    of 3

    IFRS

     15  Revenue  from  Contracts  with  


    Customers  

    When and How to recognize revenue

    BEFORE THE CHANGE AFTER THE CHANGE

    IAS 18 Revenue

    IAS 11 Construction Contracts


    IFRS 15
    SIC 31 Revenue – Barter Transaction Revenue from Contracts
    Involving Advertising Services with Customers
    IFRIC 13 Customer Loyalty Programs
    1 January 2018
    IFRIC 15 Agreements for the
    Construction of Real Estate
    IFRIC 18 Transfers of Assets from (Similar standard issued by FASB)
    Customers

    www.IFRSbox.com IFRS 2015 Revenue from Contracts with Customers

    IFRS 15 Revenue from Contracts with Customers

    STEP 1 STEP 2 STEP 3 STEP 4 STEP 5

    Identify the Identify the Determine Allocate Recognize


    contract performance the the TP to revenue
    with a obligations transaction the PO in when (or as)
    customer (PO) price (TP) the contract an entity
    in the satisfies a PO
    contract

    Oral / written?
    Contract modification? Promises
    Are they distinct? Fixed? Variable? Stand-alone selling prices
    Over time?
    At the point of time?

    www.IFRSbox.com IFRS 2015 Revenue from Contracts with Customers

    h8p://www.ifrsbox.com/ifrs-­‐kit   1  
    IFRS  15  Revenue  from  Contracts  with  
    Customers  

    IFRS 15 Revenue from Contracts with Customers

    Example: telecom co. / bundle offers

    Handset = 300 CU Free handset


    + 12-month network
    services

    Network services =
    80 CU/month 12 x CU 100
    without handset
    ABC Johnny

    www.IFRSbox.com IFRS 2015 Revenue from Contracts with Customers

    IFRS 15 Revenue from Contracts with Customers

    12-m. monthly plan at 100 CU/month


    Example: telecom co. / bundle offers
    + Free handset

    No revenue for handset (given for free)


    IAS 18
    Revenue for network services: CU 100 per month => CU 1 200 total

    IFRS 15 => Transaction price = 1 200 (100*12)

    Performance Stand-alone Allocated Revenue Billing


    obligations selling price transaction price
    Handset 300 285.70 285.70 0
    (300/1260*1200) when handset is delivered

    Network services 960 (12*80) 914.30 76.20 /month 100 /month


    (960/1260*1200) (914.30/12)

    TOTAL 1 260 1 200 1 200 1 200

    www.IFRSbox.com IFRS 2015 Revenue from Contracts with Customers

    h8p://www.ifrsbox.com/ifrs-­‐kit   2  
    IFRS  15  Revenue  from  Contracts  with  
    Customers  

    The IFRS Kit

    ü ü ü
    100 Video Lectures 130+ Case 170+ Pages of
    Studies Handouts

    ü ü ü
    IFRS Quizzes “IFRS In 1 IFRS Conversion
    Day” Course

    www.IFRSbox.com IFRS 2015 Revenue from Contracts with Customers

    h8p://www.ifrsbox.com/ifrs-­‐kit   3  

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