Asked by: Benemerito Mascaroasked in category: General Last Updated: 6th April, 2020
How is IFRS 15 different?
Similarly, what does IFRS 15 mean?
IFRS 15 is an International Financial Reporting Standard (IFRS) promulgated by the International Accounting Standards Board (IASB) providing guidance on accounting for revenue from contracts with customers. It was adopted in 2014 and became effective in January 2018.
Secondly, are ASC 606 and IFRS 15 the same? The US standard setter (the Financial Accounting Standards Board; FASB) issued ASC 606 at the same time IFRS 15 was issued by the IASB. However, other dates (e.g. when the consideration is received) are acceptable under IFRS 15, but are not permitted under US GAAP.
Also, what is the impact of IFRS 15?
IFRS 15 is the new standard on revenue recognition. This standard may become a point of reference for investors. Implementation of IFRS 15 may significantly impact revenue and profitability levels and trends. Furthermore, it may have broader implications on tax positions, loan covenants and KPIs.
What are the five steps to revenue recognition?
Within the new standards there are five steps outlined for revenue recognition.
- Step 1: Identify the contract with a customer.
- Step 2: Identify the performance obligations in the contract.
- Step 3: Determine the transaction price.
- Step 4: Allocate the prices to the performance obligations.
- Step 5: Recognize revenue.