2.Explain why the IASB has issued AASB 15 in place of the existing revenue standards (118, and 111); and
Importance of Revenue recognition
Revenue information remains paramount in accordance with the financial functioning of an entity. Thus, information centred on the “nature, timing, amount” and “ambiguity of revenue and cash flows” from “customer contracts” provides users of financial statements comparability on the performance/position of entities within the period.
Need For Standards
Conversely, limitations and discrepancies associated with existing revenue recognition requirements, affect users in comparing an entity’s “revenue” in connexion with the financial statement. Primarily, existing revenue standards, have directed inconsistencies
Importance of Revenue recognition
Revenue information remains paramount in accordance with the financial functioning of an entity. Thus, information centred on the “nature, timing, amount” and “ambiguity of revenue and cash flows” from “customer contracts” provides users of financial statements comparability on the performance/position of entities within the period.
Need For Standards
Conversely, limitations and discrepancies associated with existing revenue recognition requirements, affect users in comparing an entity’s “revenue” in connexion with the financial statement. Primarily, existing revenue standards, have directed inconsistencies