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Good afternoon Sir
Step 1: identification of a contract
there are 5 criteria given before a contract can be accounted for.
question: do ALL the criteria need to be fulfilled before the contract can be accounted for?
regards
This is from the IASPLUS pages on IFRS 15 with some words put into upper case by me
“Step 1: Identify the contract with the customer
A contract with a customer will be within the scope of IFRS 15 if ALL the following conditions are met: [IFRS 15:9]
the contract has been approved by the parties to the contract;
each party’s rights in relation to the goods or services to be transferred can be identified;
the payment terms for the goods or services to be transferred can be identified;
the contract has commercial substance; and
it is probable that the consideration to which the entity is entitled to in exchange for the goods or services will be collected.
If a contract with a customer does not yet meet ALL of the above criteria, the entity will continue to re-assess the contract going forward to determine whether it subsequently meets the above criteria.
From that point, the entity will apply IFRS 15 to the contract. [IFRS 15:14]”
I believe that the answer to your post is: YES
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