IFRS 15 Significant financing component


Joined
Dec 16, 2017
Messages
2
Reaction score
0
Country
United Arab Emirates
I have a query on the above subject:

We are in projects business (supply and installation of equipment). We have a set of customers who do not specify payment terms even though in practice payment happens within 90 days of completion of the project.

We recognize revenue at various points in time during the project period but payment process will begin only upon completion of the entire project.

Consequently, the time gap between revenue recognition and payment, depending on the project duration, may be more than a year.

In such a case, is it necessary to discount revenue for financing component?

Thanks
 

Ask a Question

Want to reply to this thread or ask your own question?

You'll need to choose a username for the site, which only take a couple of moments. After that, you can post your question and our members will help you out.

Ask a Question

Top