Under IFRS 15, how should the timing of revenue (or expense recognition on the customer’s side) be determined when the contract requires a formal certification or approval by an independent engineer or consultant before payment is released?
Does the certification represent the moment when control transfers to the customer (i.e., a point-in-time transfer), or is it merely evidential of performance that had already occurred over time?
If the work is performed on the customer’s site, under continuous supervision, and cannot be redirected to another customer, does control transfer as the work progresses, even though formal certification occurs later?
Conversely, if certification is a contractual precondition for acceptance and payment, should control be deemed to transfer only upon certification, making it a point-in-time performance obligation?
Thank you for your helpful thoughts and opinions!