9 - Further Accounting Standards

Question 1

What is the definition for revenue?

Answer 1

Income arising in the course of the entity’s ordinary activities

Question 2

What are the five stages for recognising revenue?

Answer 2

1 - Identifying the contract with the customer
2 - Identify the separate performance obligations
3 - Determine the transaction price
4 - Allocate the transaction price
5 - Recognise revenue as each performance obligation is satisfied

Question 3

What is the input / output method to recognise revenue?

Answer 3

When looking at what % of the contract has been for filled and recognising the revenue accordingly

Question 4

What is an adjusted event?

Answer 4

An event between the year end date and the date the financial statements are authorised that provided additional information about a condition that existed that existed at the end of the reporting period, for example; provisions that were made becoming certain or asset reevaluations being received that show an impairment is needed

Question 5

When must an adjustment be in the financial statements post year end?

Answer 5

If the amount is material

Question 6

What is a non-adjusting event?

Answer 6

An event happens after the reporting period has ended that was unknown at the last day of the reporting period. For example; a fire that destroys a major asset after the year end

Question 7

When must a non-adjusting event be disclosed?

Answer 7

When it is material