PFRS #15 Revenue from contracts with customers

• income is the increases in economic benefits during the accounting period in the form of inflows or enhancements of assets or decreases of liabilities that result in increases in equity other than those relating to contributions from equity participants. and income encompasses both revenue and gains
• revenue is income arising in the course of the entity's ordinary activities
• contract is an agreement between two or more parties that creates enforceable rights and obligations it can be written, oral, or implied by an entities customary business practice
• customer is a party that has contracted with an entity to obtain goods or services that are an output of the entities ordinary activities in exchange for consideration
• contract liability is an entity's obligation to transfer goods or services to a customer for which the entity has received consideration from the customer
• contract asset is an entities right to consideration in exchange for goods and services that the entity has transferred to a customer when the right is conditioned on something other than the passage of time
• receivable is an entity's right to consideration that is unconditional
• contract costs include:

  1. incremental costs of obtaining a contract
  2. costs to fulfill a contract
• incremental costs of containing a contract

  • are costs incurred in obtaining a contract with a customer that the entity would not have incurred had the contract not been obtained
• costs to fulfill a contract

  • costs incurred in fulfilling a contract that are within the scope of other standards are, accounted for in accordance with those standards
• steps in revenue recognition

  1. identify the contract with the customer
  2. identify the performance obligations in the contract
  3. determine the transaction price
  4. allocate the transaction price to the performance obligations in the contract
  5. recognize revenue when the entity satisfies a performance obligation