Revenue recognition

Date recorded:

Re-exposure of proposals

As the Boards have substantially completed their redeliberations surrounding the Revenue ED, the Boards considered whether re-exposure of the proposed revenue standard would be necessary.

The Boards made the following tentative decisions, as summarised below:

  • The Boards tentatively decided that the core principles in the ED have remained largely intact and that the changes to the ED mostly clarified or simplified the application of these principles, and therefore, a re-exposure of the ED was not required based on the re-exposure criteria set out in the Boards' manuals
  • However, the Boards felt that given the importance of the revenue project and the volume of changes that have been proposed, it would be appropriate to re-expose the draft. The Boards tentatively decided that the re-exposure draft would focus on seeking comments from constituents on the understandability, clarity, operationality, interaction of paragraphs and wording of the overall re-exposure draft. The Boards also tentatively decided to invite comments on four specific areas where constituents generally have not had the opportunity to comment on the revised requirements:


    Determining when a performance obligation is satisfied over time (i.e., the additional guidance in response to concerns about control and services)


    Presenting the effects of credit risk adjacent to revenue


    Constraining the cumulative amount of revenue recognised to amounts that are reasonably assured (rather than constraining the transaction price to amounts that can be reasonably estimated)


    Applying the onerous test to a performance obligation satisfied over a long period of time.

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