IFRS 15 changes your revenue recognition
The long-awaited standard for revenue recognition has been published: the new International Financial Reporting Standards (IFRS 15). If the European Commission approves the new standard, this may change the way your company has to recognise revenue.
The new IFRS 15 standard is effective for financial years starting on or after 1 January 2017, with comparative figures over 2016. In Europe, businesses may voluntarily apply the standard sooner after approval of the European Commission.
- Identify the contract with the client
- Identify the separate delivery obligations within the contract
- Determine the transaction price
- Assign the transaction price to the delivery obligations within the contract
- You are allowed to recognise the revenue when the delivery obligations have been met
Prepare in good time
For entrepreneurs like yourself it is important to prepare in good time and to know to what extent you have to adjust the revenue recognition. The new standard may have a major impact on, for example, your systems, processes and taxes.
Are you keen to know what the consequences are for your business? Or do you want to know what the impact will be on your processes and systems? Then please contact our international specialists or your regular advisor at Baker Tilly Berk.