7.1 Revenue
7.1.1 Definition
Income. Income includes both revenues and gains.
Revenue. Income arising in the course of an entity's ordinary activities.
Gains represent other items that meet the definition of income and may, or may not , arise in the course of the ordinary activities of an entity.
7.1.2 Revenue Recognition and Measurement
1. Recognition Criteria for Revenue
Its core principle is that revenue is recognised to depict the transfer of goods or services to a customer in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services.
Under IFRS 15 the transfer of goods and services is based upon the transfer of control, rather than the transfer of risks and rewards as in IAS 18.
Control of an asset is described in the standard as the ability to direct the use of, and obtain substantially all of the remaining benefits from, the asset.
Some indicators of the transfer of control are:
Ø (a) The entity has a present right to payment for the asset.
Ø (b) The customer has legal title to the asset.
Ø (c) The entity has transferred physical possession of the asset.
Ø (d) The significant risks and rewards of ownership have been transferred to the customer.
Ø (e) The customer has accepted the asset.
7.1.3 The five-step model
Step 1 Identify the contract with the customer
Step 2 Identify the separate performance obligations
Step 3 Determine the transaction price
Step 4 Allocate the transaction price to the performance obligations.
Step 5 Recognise revenue when (or as) a performance obligation is satisfied.

