Sunday, December 1, 2013

[IFRS] IAS 18 - Revenue - Part 6: Application of Service Revenue Recognition Criteria

Application of Service Revenue Recognition Criteria

Transaction

Revenue Recognition
Servicing fees, if included in price of product

Amount that relates to servicing the product should be deferred and amortized over the time of the service contract
Advertising commission                          


Media

When related advertisement appears before the public
Production

With reference to the stage of completion
Insurance Agency Commissions


Agent renders further service

Defer over the period during which the policy is in force
Agent does not renders further service

At the date of policy commencement or renewal
Franchise Fees

On the basis reflecting the purpose for which the fees are charged
Earned as services are provided

When related service is provided
Earned on execution of significant act

When related significant act has been completed
Continuing Franchise fee

As the services are provided or the rights to use franchise logo or brand name is utilized 
Tuition fees

Over the period of instruction
Membership or Club fees


 No additional services provided

On commencement of membership
Additional services provided

Defer over the membership period on some reasonable basis.
Fees from Development of Customized Software

With reference to the stage of completion, including the post-delivery service support stage.