One of the two methods to measure progress to completion in IFRS 15 Revenue recognition over time. The other is input method.
Revenue is recognised on the basis of direct measurements of the value to the customer of the goods or services transferred to date relative to the remaining goods or services promised under the contract. Examples of these methods include appraisals of results achieved, important stages reached, an estimate of the time elapsed or a calculation of the units produced or delivered. However, these output methods have certain disadvantages which may prevent their use in practice (see Milestone method may not depict pattern of performance). A practical expedient is offered under certain conditions