What is the meaning of IFRS 15?

What is the meaning of IFRS 15?

International Financial Reporting Standard
IFRS 15 is an International Financial Reporting Standard (IFRS) promulgated by the International Accounting Standards Board (IASB) providing guidance on accounting for revenue from contracts with customers. It was adopted in 2014 and became effective in January 2018.

What is a material right under IFRS 15?

Material Rights is an option given to a customer to acquire additional goods or services free of charge or at a discount.

Which of the following is the main objective of IFRS 15?

The objective of IFRS 15 is to establish the principles that an entity shall apply to report useful information to users of financial statements about the nature, amount, timing, and uncertainty of revenue and cash flows arising from a contract with a customer.

What does IFRS stand for?

International Financial Reporting Standards
International Financial Reporting Standards (IFRS) are a set of accounting rules for the financial statements of public companies that are intended to make them consistent, transparent, and easily comparable around the world.

What is a contract asset under IFRS 15?

IFRS 15 includes the following definitions: Contract asset. An entity’s right to consideration in exchange for goods or services that the entity has transferred to a customer when that right is conditioned on something other than the passage of time (for example, the entity’s future performance). Contract liability.

What material right means?

A material right is an option to purchase additional goods or services at a price that is less than what the customer would have paid if they had not entered into the contract. If this right exists in the contract, then it should be accounted for as a separate performance obligation.

What is a material right in revenue?

A material right is a promise embedded in a current contract that should be accounted for as a separate performance obligation. An option to purchase additional goods or services at their standalone selling prices is a marketing offer and therefore not a material right.

What are the key changes in IFRS 15?

One of the key changes introduced by IFRS 15 Revenue from Contracts with Customers is that revenue recognition is now based on the transfer of control over goods or services to a customer, rather than just the transfer of risks and rewards.

What are accounting standards and IFRS?

The International Financial Reporting Standards (IFRS) are accounting standards that are issued by the International Accounting Standards Board (IASB) with the objective of providing a common accounting language to increase transparency in the presentation of financial information.

What is IFRS compliance?

International Financial Reporting Standards (IFRS) is a set of accounting standards, developed by the International Accounting Standards Board (IASB) that is becoming the global standard for the preparation of public company financial statements. The IASB is an independent accounting standards body based in London.