The Accounting Standards Board (AcSB) has issued amendments to ASPE Section 3400 Revenue (the “Amended Guidance”), to provide more robust guidance to support the application of the existing risk-and-rewards revenue model, which differs from the control-based model used under IFRS and U.S. GAAP post-2018.

These amendments will provide guidance on:

• Determining whether an arrangement consists of a group of contracts or a single contract and identifying the units of account in an arrangement;
• Allocating consideration in multiple-element arrangements to separate units of account;
• Accounting for revenue under the percentage-of-completion method;
• Reporting revenue gross or net;
• Determining when to recognize revenue for a bill-and-hold arrangement; and
• Determining when to recognize revenue for upfront non-refundable fees or payments.

The Amended Guidance also expands disclosure requirements for contracts in progress at the end of the reporting period accounted for using the percentage-of-completion method.

The Amended Guidance is effective for fiscal years beginning on or after January 1, 2022, with earlier application permitted.

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