- 15 Marks
FR – May 2022 – L2 – SB – Q5 – Revenue from Contracts with Customers (IFRS 15)
Compare contract liabilities and assets, stand-alone selling price vs. transaction price, and assess contract modification criteria.
Question
IFRS 15 – Revenue from Contracts with Customers defines a contract as an agreement between two or more parties that creates enforceable rights and obligations.
Required:
a. Compare with an example, where necessary:
i. Contract liabilities versus contract assets (2½ Marks)
ii. Stand-alone selling price versus transaction price (2½ Marks)
b. Under IFRS 15, highlight SIX criteria to assess a contract. (6 Marks)
c. Explain what is meant by contract modification and state TWO ways in which it can be accounted for. (4 Marks)
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