Revenue recognisation in the case of turn key project
This query is : Resolved
CA HARDIK THAKKAR
(Querist)
03 October 2012
Hello Sir,
My client has a business of turn key project for which it is recognising the revenue as per the payment term in the contract. i.e if in the contract there is a term of Advance payment then it is reconising such advance receipt as a income. is it feasible??? how to recognise revenue at the end of the year if project is not completed?
I request you to give answer on the basis of IFRS.
Thanking You,
CA Hardik Thakkar
My client has a business of turn key project for which it is recognising the revenue as per the payment term in the contract. i.e if in the contract there is a term of Advance payment then it is reconising such advance receipt as a income. is it feasible??? how to recognise revenue at the end of the year if project is not completed?
I request you to give answer on the basis of IFRS.
Thanking You,
CA Hardik Thakkar
04 October 2012
In case of any turnkey projects in India, for recognizing income one should follow AS-7 which states that one should recognize revenue according to work certified not as per payment terms in the contract.
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