Transfer of control is a sale

IFRS 15 Vehicle sales by OEMs (Original Equipment Manufacturers) – BEST QUICK READ

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IFRS 15 Vehicle sales by OEMs IFRS 15 Vehicle sales by OEMs (Original Equipment Manufacturers) shows examples of real life situations, in this case close at home, selling cars and when is it really sold as per IFRS 15. An OEM typically sells the cars and trucks that it produces to a dealer that then sells the vehicles to consumers. Under IFRS 15, an OEM recognizes revenue for the sale of a vehicle when it transfers control of the vehicle to its customer (i.e., the dealer). Control of the vehicle transfers to the dealer when the dealer has the ability to direct the use and obtain substantially all the remaining benefits of the vehicle. OEMs need to consider whether they … Read more

Transfer of control for distinct licences

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Transfer of control for distinct licences – IFRS 15 indicates that an entity must determine, at contract inception, whether it will transfer control of a promised good or service over time. If an entity does not satisfy a performance obligation over time, the performance obligation is satisfied at a point in time. A performance obligation is satisfied over time if it meets one of the following criteria: Transfer of control for distinct licences The customer simultaneously receives and consumes the benefits provided by the entity’s performance as the entity performs – by providing hosting services, for example. Transfer of control for distinct licences The entity’s performance creates or enhances an asset that the customer controls as the asset is created … Read more