SIC-31 Revenue \u2013 Barter Transactions Involving Advertising Services<\/li>\n<\/ul>\nObjective<\/h3>\n
The objective is to establish principles that an entity shall apply to report useful information to users of financial statements regarding the nature, amount, timing and uncertainty of revenue, and also cash flows arising from a contract with a customer.<\/p>\n
Scope<\/h3>\n
This new revenue model applies to all contracts with customers except:<\/p>\n
If a contract with a customer falls within the scope of both IFRS 15 and the scope of another standard then:<\/p>\n
Five-Step Model Framework<\/h3>\n
The core principle of the standard is that an entity should recognise revenue to show the transfer of promised goods or services to the customer in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services.<\/p>\n
Step 1: Identify the contract(s) with the customer<\/strong><\/p>\nIFRS 15 defines a contract as an agreement between two or more parties that creates enforceable rights and obligations and sets out the criteria for every contract that must be met.<\/p>\n
A contract with a customer will be within the scope of IFRS 15 if all the following conditions are met:<\/p>\n
\n- the contract has been approved by the parties to the contract;<\/li>\n
- each party\u2019s rights in relation to the goods or services to be transferred can be identified;<\/li>\n
- the payment terms for the goods or services to be transferred can be identified;<\/li>\n
- the contract has commercial substance; and<\/li>\n
- it is probable that the consideration to which the entity is entitled to in exchange for the goods or services will be collected.<\/li>\n<\/ul>\n
Step 2: Identify the performance obligations in the contract<\/strong><\/p>\nA performance obligation<\/strong> is a promise in a contract with a customer to:<\/p>\n