REVENUE FROM CONTRACTS (IFRS 15)

① IDENTIFY THE CONTRACT

Approval of
rights & obligations
Dr Receivable

C 5)1 000 Cr Revenue $1000 i

②
-years
IDENTIFY THE PERFORMANCE OBLIGATION Deferred int
Cr
-
$2004

citing
restomer
- Laptop Dr
Each should
ofligation
Diam
be
Laptop -> PV
? interest income
separable

o
-
-
$1m
-

Bundled price
PRICE-
2
are year
③ DETERMINE TRANSACTION
⑮

imp
Expense -

, , ↓
PV
·
$100 0

= >
↓
>

~ -

-
Cash Consideration a Cash
selling price (after considering time value of money)
-
year ,
You consider the time value of money and the -consideration receivable later - contract price that's payable after 2 years
-

significant financing component is the interest income

-
Deferred interest. Diff 6/w &0
-> -

· Non-cash Consideration -
Eg: Consultancy services for 100 shares

if me
price of shares is not available
,
a comparable price of consultancy services is used

Consideration payable
· to customer if s eller is
the some cash to me buyer the transaction price is reduced by the amount
a -

paying ,

STEP 4: ALLOCATE PERFORMANCE ABAONS TO THE CONTRACT PRICE

-
, 000
P
10
.

A -eutligused
stand-alone
price is ation ·? Leviation

G · Allocated in

-
pro-rata basis for each
Oblig ation Rish-
↳"June ,

t
2023

3E $ Im
50 % of Revenue Rec.

Recognize 2024

S Of↳ $1m+
-

--2024
O
-
204
10 % Du cash
-- I Revenu $ 2m TODAY -
Commission
Tota z evence
satie a

:R nic revenue When gations ⑧

STEP 3 are 2025
RISK "June
⑭u T
Estimate
⑮ Recognises
Revenue Recognises - Commission

a ↑
7
--
7 C

satisfied
-
PRI NCIPAL v/ D
C
↑ AG EN I
-

3
- Mese
obligations are
&
f Can't Set prices

~ Not exposed to default risk

CONSTRUCTION ~

w
tell I'm
can ya an
agent
-
·
No inventory risk

·
W Not responsible for fulfiling contract

-
me

2 ⑨ Output method
2 prime
certified
I Eg completed
Work
-
cost incurred R
:
Completion percentage
Pop inputT
=

=>
60 % of Total Revenue Total Expected costs
12
4 Revenue = % completed x Total revenue
DISCLOSURES ↳ lash

· Mention
judgements regarding the D
s steps
&

-m
-

-I
Details about act L
A the co
-
-

Dract
w
↓
->X600
600
- Phone Asset
-↓
substitute contract Asset $ 1000
I

-
Idr-
Cash cast
CA
-
Cash $1000
Cr Revenue
686

O >
SAP

-
->
DUMMY
↑

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↓
-
B -

↓
D
= - - O UNWINDING
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686
r

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-

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->
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L

Y
&
-

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PRORATA

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-

↳ ->
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-> -

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