IFRS 15

will apply to all contracts with the exception of the following:

● lease contracts does not apply to IFRS 15 because it has a separate standards
lease - rent/upa, transaction between the landlord and tenant with certain stipulations
– this will have a contract
– no more distinct separation between the old standards for lease
– record an asset (right of use of asset)
– practical expedient - practical approach, comply with IFRS 16, account for lease transaction
under a single line; if not applicable, apply all text of IFRS 16 - discount the future cash flows;
bonds payable.
● insurance contracts usually have two parties
● there is a contract involved
● insured & insurer
● pay premiums (monthly, quarterly, etc)
● insurer can manage those premiums
● passes the risk (insurance)
– risk is financial loss, this will transfer to the insurer (insurer will bear the risk)
– IFRS 4 have a different set of standards
– IFRS 4 should be used whenever an entity is an insurance company
● Financial Instruments (Investments) is under IFRS 9
– whenever stock or bonds or securities have contracts, with obligations and rights attached
– contractual rights, obligations within that contracts
– auxiliary assets only that’s why it was called investments
● Non-monetary exchanges
– transfer between two or more entities in the same industry

An entity shall recognize a revenu to depicts the transfer of promised goods or services to
customers
– for the entity to recognize revenue
– how and when do we recognize revenue
– we’ll recognize revenue in such a way that depicts the transfer of goods or services to
customers; meet a performance or obligation; at year end, reassess those obligations

How to account transactions under IFRS 15

5-steps in recognizing revenue in the books