The PSAB proposes, subject to comments received following exposure, to issue a new Section on revenue.

The main features of the Exposure Draft are as follows:

• A framework for revenue is proposed describing two categories of revenue — exchange transactions or unilateral transactions.
• If the transaction gives rise to one or more performance obligations, it would be an exchange transaction.
• Performance obligations are enforceable promises to provide goods or services to a payor as a result of exchange transactions.
• Revenue from an exchange transaction is recognized when the public sector entity has satisfied the performance obligation(s).
• The performance obligation(s) may be satisfied at a point in time or over a period of time.
• If no performance obligations are present, it would be unilateral revenues.
• Unilateral revenues result in increases in the economic resources of a public sector entity without a direct transfer of goods or services to the payor.
• Unilateral revenues are recognized when a public sector entity has the authority to claim or retain an inflow of economic resources and a past event gives rise to a claim of economic resources.

The new Section would apply to fiscal years beginning on or after April 1, 2021. Earlier adoption is permitted. The Section would be accounted for as a change in accounting policy applied retroactively with restatement of prior periods.

Review the Exposure Draft on the PSAB's Web site.