Variable consideration in transaction price and 4 best examples

Variable consideration in transaction price

IFRS 15 Revenue from Contracts with Customers (contents page is here) introduced a single and comprehensive framework which sets out how much revenue is to be recognised, and when. The core principle is that a vendor should recognise revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the vendor expects to be entitled in exchange for those goods or services. See a summary of IFRS 15 here. Variable consideration in transaction price

This section is part of step 3 determining the transaction price. Instead of the amount of consideration specified in a contract being fixed, the amount receivable by a Read more

1 to Read at best – Implicit promises in a contract

Implicit promises in a contract

IFRS 15 Revenue from Contracts with Customers (contents page is here) introduced a single and comprehensive framework which sets out how much revenue is to be recognised, and when. Implicit promises in a contract

The core principle is that a vendor should recognise revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the vendor expects to be entitled in exchange for those goods or services. See a summary of IFRS 15 here. Implicit promises in a contract

This section is part of step 2 identifying performance obligations. Goods or services that are to be transferred to a customer are normally … Read more

Consideration payable to a customer – Great 2 read

Consideration payable to a customer, this is a payable to the customer not a receivable from the customer (just because otherwise I get confused) – When determining the transaction price, an entity should consider the effects of all of the following: (1) variable consideration; (2) a significant financing component (i.e., the time value of money); (3) non-cash consideration; and
(4) consideration payable to a customer.

IFRS 15 Revenue from Contracts with Customers (contents page is here) introduced a single and comprehensive framework which sets out how much revenue is to be recognised, and when. The core principle is that a vendor should recognise revenue to depict the transfer of promised goods or services to customers in an … Read more