What you should know about IFRS 15 – Revenue Recognition
If you work in accounting in a firm, for instance, it is important to stay informed and abreast of the IFRS standards and issues. This is equally valid for anyone interested in accounting, insurance, or taxation, whether they are students or working professionals looking to improve their skills. One of the IFRS standards is the IFRS 15. This article gives you a basic idea of what IFRS 15 is and where you can find more information about the subject matter.
What is IFRS 15?
The IFRS – International Financial Reporting Standards – provides the accounting guidelines for companies traded as public entities, to declare their financial statements, ensuring each report is uniform, transparent, and simple to compare globally.
Under the IFRS, several standards and issues (IFRS 1-17 and IAS 1 – 41) address various aspects of financial reporting from asset declaration to property and equipment leases to agriculture. The IFRS seeks to be as detailed as possible, using no obscure or muddled terms and is regularly updated, reviewed, and changed to meet current standards of operations, where necessary.
IFRS 15 requires these firms to give users of financial statements more detailed, pertinent disclosures and specifies in what way and when the IFRS reporter must recognize revenue. The standard offers a single, five-step model with a set of guiding principles that should be used for all client contracts. The annual reporting year commencing on or after January 1, 2018, is covered by IFRS 15, which was released in May 2014.
Each financial statement provides users and analysts with information on revenue and cash flows including the amount, nature, timing, and certainty or otherwise, derived from a contract with a customer. IFRS 15 sets the standards that a company should use. For annual reporting periods beginning on or after January 1, 2018, the standard must be used.
The five-step model of the IFRS 15:
- Determine the customer contract as the first step.
- Determine the performance obligations.
- Determine the transaction price.
- Allocate the transaction price to the contract’s performance responsibilities.
- Recognize income as soon as the entity fulfills a performance obligation.
Having established the basic concept of IFRS 15, you might ask where you can find more information on the subject with good explanations. Annual Reporting seeks to provide accurate and current information for anyone using the IFRS standards and issues for financial reporting.
Where to get more information on IFRS 15
Annual Reporting is a website that compiles and publicizes the most current information from the International Financial Reporting Standards (IFRS). The website contains detailed information on all IFRS standards and provides examples to allow you properly follow the explanations. There are also chapters that compared the IFRS standards to US GAAP (Generally Accepted Accounting Principles). Also, the website has a menu that makes it easy to navigate topics without having to search. Finally, there is a quick reference page dedicated to all IFRS jargon, this is something that will come in handy when you come across terms you might not be familiar with. Do you want to learn a great deal about these topics, then it is about time that you visit annualreporting.info.
