There are already a number of challenges that students have to deal with in their curriculum. Dealing with a challenge such as IFRS 15 becomes a burden of its own on accounting students. An accounting assignment is not an easy nut to crack, and when there is an entry of something like IFRS 15, it gets more complicated. Doing the accounting assignment at this moment feels like decoding an unknown, ancient language.
However, do not worry about all of this as we are going to decode all that is about IFRS 15. If the term “IFRS 15” has already got you sweating, you wipe that off. Because it is a simple guide to make you learn of the terminology and how you can incorporate it in your accounting assignments. In any way, if you feel you need personal assistance, you can get accounting assignment help from an expert.
What is IFRS 15?
In simple terms, IFRS 15 (short for Revenue from Contracts with Customers refers to how companies recognise revenue. It shows you the rules for when and how revenue is recorded. This ensures that businesses are transparent and consistent. Or you can say that it answers a “very age-old accounting question” – “when can you officially say that you have earned the money?. This standard is a very big deal because it is not relevant not just for assignments but also in real-world accounting. There are instances where students have been staring blankly at your text. If this is something that has been happening with you as well, come in touch with a professional giving help in accounting assignment services. They will give you the clarity for the subject if you need.
Why Is IFRS 15 Tricky for Accounting Students?
Let’s be honest – accounting is not always straightforward, and IFRS 15 can begin to feel like being in a labyrinth. Here is why it can get tricky for you to do the accounting assignments with IFRS 15:
The Jargon Overload
When your assignment is filled with heavy terminologies, it can become crazy for you. Terms like performance obligation” or “transaction price” can get too technical fast.
The Fine Line
Finding that fine line of whether revenue should be recognised over time or at a specific time can get confusing. You can eliminate the confusion by taking assistance from the accounting assignment help Australia service.
Real-World Application
Most students also struggle with the real-world application of theoretical concepts. Textbooks can fail to bridge the gap between theory and practice. This causes an academic inability to make assignments while keeping the learning curve intact.
Breaking Down the Five Steps of IFRS 15
As much as challenging IFRS 15 is, there is an inherent quality in IFRS 15 that makes it great. IFRS 15 breaks down the revenue recognition into digestible steps. Here is how it works in your accounting assignment:
Identify the Contract
First, you have to confirm whether there is a legitimate legal agreement between two parties involved in the matter. For example, a business selling annual gym memberships will have a contract to provide search for a year.
Pinpoint the Performance Obligations
The experts providing account assignment help mentioned that you should break the contract into each promise made. For example, if a gym offers fitness classes and personal training sessions, both of these are separate obligations.
Calculate the Transaction Price
You should know about what is the total “potential” and what is the total amount of the business. You can also adjust it all for any discounts and special offers.
Allocate the Price
It is time to divide the money on an equal basis as you have to divide the total money among the both obligations. For example, if the gym membership is inclusive of both classes and training, a fair share should be assigned to each based on their value.
Recognise Revenue
The professionals providing auditing assignment help emphasise that earning revenue is on what path exactly. Either the revenue is earned all at the same time or over time (like monthly gym services).
Take an Example: IFRS 15 in Action
Now, it is time for some real action where you have to put all the learned knowledge into practice. You will see that there is no rocket science to putting IFRS 15 into practice for your accounting assignment. We will take an example of a software company that sells a package. This package is a one-year subscription for their software license with customer support. Here are the steps laden by the experts of accounting assignment help service:
- There is a contract the moment a customer signs up for the package
- Keep in mind that the license and support are two different performance obligations
- When the customer pay $1,200 upfront; it is the transaction price
- Based on their individual values, allocate $800 to the license and remaining $400 to the customer support
- Identify the $800 amount right away for the license and divide $33.33 monthly over a period of twelve months for the support
Tips to Ace Your First IFRS 15 Assignment
Now that you have learned how to incorporate IFRS 15 in your accounting assignments, you are ready to tackle it with confidence. In addition to this, here are some tips provided by the professionals providing accounting assignment help online to make sure you get it absolutely right:
- Start with the basis and make sure you understand the five steps before going into the nitty-gritty details
- Use real-world scenarios like subscription services, product bundles or construction contracts
- Visualise the process by creating flowcharts or tables and map out how revenue is organised
- Keep practising because the more problems you will solve, the more confident you will get
Find the Professional Help to Upgrade Your Assignment’s Quality
IFRS 15 is a tricky game to put together when you are on your own. However, with the above-mentioned steps, you will be able to tackle this complex dynamic of accounts in your assignment better. Moreover, the tips given to you will work as a sure-shot path to score an A in your grades. Still, if things turn upside down, try to pair your knowledge with insights from auditing assignment help services. These services can give you a more rounded understanding of related concepts. So, do not keep waiting and start working on your accounting assignments today! read also this – Motorised Door Blinds: The Perfect Blend of Style and Functionality
Frequently Asked Questions
What does “control” mean in IFRS 15?
Control is about who has control over the asset. This means who has the power to use and benefit from the asset.
What if the transaction price is not fixed?
For variable prices, you estimate based on probabilities or likely amounts. Just remember to take into account constraints for avoiding overstating revenue.
Can I recognise revenue for partially completed obligations?
Yes, if a customer is benefiting from your progress (like an ongoing construction), you can recognise revenue over time.
How do bundle sales affect revenue allocation?
Based on its standalone value, each item in the bundle gets its fair share of the transaction price.
