International Accounting Standard 18

• Issued: in 1982; re-issued in 1993, followed by amendments
• Effective date: 1 January 1993
• Replaced by IFRS 15 effective 1 January 2018
• What it does:
  • It prescribes the general rules for recognition of revenue, including exchanges of goods or services.
  • It specifies the recognition criteriafor the following categories of revenue:
    • Sale of goods;
    • Rendering of services;
    • Interest, royalties and dividends.
  • It brings further guidance on specific transactions in the appendix, such as bill and hold sales, goods shipped subject to conditions, lay away sales; installation fees, advertising commissions, financial service fees, license fees and royalties, etc.

• Summary of IAS 18 Revenue
• IFRS 15 vs. IAS 18: Huge Change Is Here! - the article illustrates the impact of IFRS 15 and compares it with IAS 18 in a simple example
• Principal or Agent – Revenue or Liability? - this article provides a deeper analysis of a principal vs. agent relationship with accent on revenue recognition

• How to account for settlement discounts?

For more practical questions and answers related to revenue recognition, please refer to IFRS 15 Revenue from Contracts with Customers.

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