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Recognition
Update
01
04/2015
IFRS 15
Revenue from
Contracts with
Customers
INTRO
IFRS 15 Revenue
Pernilla Lundqvist,
head of Nordic IFRS 15
Revenue topic team,
Accounting Advisory
Services, KPMG Sweden
Recognize revenue when (or as) the entitiy satisfies a performance obligation
And more specifically, under IFRS 15, the following analysis should be done:
Step 5:
Contract
Performance
obligation 1
Performance
obligation 2
Revenue on
performance obligation 1
Revenue on
performance obligation 2
5000
3289
= 5000 (5000/7600)
1000
658
= 5000 (1000/7600)
Repair/maintenance
750
493
= 750000 (5000/7600)
Laundry powder
450
296
= 5000 (450/7600)
Voucher
400
263
= 5000 (400/7600)
7600
5000
Sum
Calculation
Repair/maintenance
Transaction
price allocated
Goods/service
Stand-alone
selling price
Goods/service
Washing machine
+ 12 months warranty
31 December
2017
31 December
2018
31 December
2019
31 December
2020
3289
SUM
3289
329
329
658
164
164
165
493
Laundry powder
197
99
Voucher
263
Sum
3289
624
296
263
592
494
5000
The example is a simplified example to illustrate some of the main priniciples in IFRS 15. The name Elektro
Butikken is a name used for illlustration purposes only, and not based on a real-life company we know.
The example is based on the facts the given. In real-life, facts may differ, for example, 2 years extended
warranty may be an insurance contract and ElektroButikken may be an agent selling insurance contracts
on behalf of an insurance company. Further, it might be the laundry powder producer that sells the laundry
powder, not ElektroButikken, etc. This to illustrate that implementation of IFRS 15 requires a good under
stading of the underlying business.
IAS 18 is an old standard. Whether or not IFRS 15 represents a change in a case like the one in this publi
cation depends on how IAS 18 has been implemented..
Edition closed
29 April 2015
KPMG Iceland
KPMG Finland
Transistion approach
2017
Date of cumulative
effect adjustment
Full retrospective
January 1, 2016
January 1, 2016
No contracts restated;
reported on the basis of
IAS 18
January 1, 2017
Jhann I. C. Solomon,
Accounting Advisory
Services, KPMG Iceland
2016
Comment: Please note that if the expected exposure draft is implemented as suggested, all dates can be
deferred with one year.
The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity.
Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is a ccurate as of the
date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional
advice after a thorough examination of the particular situation.
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2015 KPMG, Nordic member firms of the KPMG network of independent member firms affiliated with KPMG International Cooperative
(KPMG International), a Swiss entity. All rights reserved.