Revenue Accounting Standards | Australia
Significant changes to revenue recognition, implemented on 1 January 2018 (and deferred for Not-for-Profits to January 2019), require all entities to assess and potentially amend each of their customer contracts.
The new rules under AASB 15 Revenue from Contracts with Customers (AASB 15) apply to all entities, due to Australia’s ‘sector neutral’ standards. The changes require significant judgement involving complex accounting and could disrupt the usual timing of revenue recognition for many entities.
The changes require all stakeholders beyond the finance function to work together to identify the impact of these changes on systems and processes. Teams will need to ensure compliance and reporting has begun at the start of the process, rather than as an after-thought when putting financials together, year-end.
This report, Accounting for Revenue, outlines the main changes, opportunities and consequences of AASB 15 Revenue from Contracts with Customers (AASB 15). It also breaks-down the five-step model to recognise revenue earned from a contract (with limited exceptions), regardless of the type of revenue transaction or the industry that the entity operates in.
For more information on revenue recognition and how it effects your entity, seek advice from your local William Buck office.
