Revenue – ifrs 15 handbook

Contract asset and contract liability – Based on past performance
IFRS 15.IE199–IE200
The standard requires an entity to present a contract asset or contract liability 
after at least one party to the contract has performed. However, Example 38 in 
the standard suggests that an entity recognises a receivable when it is due if 
the contract is non-cancellable, because the entity has an unconditional right to 
consideration (for further discussion, see 
Single contract asset or contract liability for contracts with 
multiple performance obligations
IFRS 15.BC317
An entity presents a contract asset or a contract liability in its statement of 
financial position when at least one party to the contract has performed. When 
a contract contains multiple performance obligations, it is possible that at a 
given point in time some performance obligations could be in a contract asset 
position and others in a contract liability position. In this case, an entity presents 
a single contract asset or liability representing the net position of the contract as 
a whole. The entity does not present both a contract asset and a contract liability 
for the same contract. It may be challenging to determine a single net position 
in some circumstances if, for example, different systems are used for different 
performance obligations.
entity combines two or more contracts and accounts for them as a single 
contract, then it presents a single contract asset or contract liability for that 
combined contract. This is consistent with the guidance on the combination of 
contracts that specifies determining the unit of account based on the substance 
of the transaction, rather than its legal form.

---

© 2019 KPMG IFRG Limited, a UK company, limited by guarantee. All rights reserved.
11 Presentation | 301
11.1 Statement of financial position
|