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Hi Mike
Please could you help me with the ifrs15 ..
i’ve gone through the notes and am okay with the terms used however when it comes to an exam question i want to be sure im okay ..So my question is would if we got a contract with wip or deposit paid etc Would we only recognise a deferred income until all perfermance Obligations are met under the 5 steps or am in missing the point on this ??When should the revenue been recognised ??
Thanks a million
Revenue will be recognised according to the stage reached
You need to be able to break the contract down into separate elements and, as soon as an element is completed, the appropriate revenue for that activity is recognised
Is that any better?
Yes thanks, but when we introduce this new standard for example in question , we also bring into account IAS 8 changes in accounting policies for previous customer contracts and apply retrospectively , this would be very complex would it for large companies ?
what about contracts with wip where control in not met ?
is this only relating to IAS2 sorry i’m going through ever possible way this could come up ?
Thanks again for your help
IFRS 15 WILL involve IAS 8 change in accounting policy and restatement of prior year figures
‘what about contracts with wip where control in not met ?’
If revenue has not yet been earned, then don’t recognise any revenue. Any costs to date will be classed as work-in-progress
OK?
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