The IASB’s new revenue standard has the potential to change the way some entities recognise revenue from their customers. This Live webinar recording provides an overview on IFRS 15 Revenue from Contracts with Customers.
The International Accounting Standards Board (“IASB”) has issued IFRS 15 Revenue from Contracts with Customers. The Standard will replace IAS 18 Revenue, IAS 11 Construction Contracts and four related interpretations. The new Standard is to be first applied for periods beginning on or after 1 January 2017. The Australian Accounting Standards Board (“AASB”) and the New Zealand External Reporting Board (“XRB”) are expected to issue local equivalent standards with the same commencement date later this year.
The core principle of the new Standard is that revenue is recognised on a basis that reflects the transfer of promised goods or services to customers at an amount that reflects the consideration the entity expects to receive in exchange for those goods or services. For basic transactions involving the sale of goods (for example, basic retail sales), the new standard is unlikely to result in any change from current practice. However, there may be changes for transactions involving the provision of services or those containing multiple elements.
Conclusion
The introduction of IFRS 15 has the potential to change the timing of revenue recognition for some types of transactions. Your local advisors can assist you to further analyse the potential impacts of the new revenue model on your operations and whether any changes to your current procedures may be needed.
