Revenue – ifrs 15 handbook

Overview
IFRS 15.C1
The standard is effective for annual periods beginning on or after 1 January 
2018. Early adoption was permitted.
IFRS 15.C3
An entity may make the transition to the standard using one of two methods.
– Apply the standard retrospectively (with optional practical expedients) 
and record the effect of applying the standard at the start of the earliest 
presented comparative period.
– Apply the standard to open contracts at the date of initial application and 
record the effect of applying the standard at that date. The comparative 
periods presented are not restated.
The examples used to illustrate the application of the transition methods in 
this section reflect a calendar year-end entity that applies the standard as of 
1 January 2018. Some examples include two years of comparative financial 
statements.
For additional examples on applying the transition methods, see our publication 
Transition to the new revenue standard
.
For examples of transition disclosures, see our 
Guide to annual financial 
statements – IFRS 15 Revenue supplement
.
13.1 Transition
IFRS 15.C3
An entity can apply the standard to all of its contracts with customers using either:
– the retrospective method (see 
Section 13.2
); or
– the cumulative effect method (see 
Section 13.3
).

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13 Effective date and transition | 327
13.1 Transition
| 
IFRS 15.C2
For the purposes of transition:
– the ‘date of initial application’ is the start of the reporting period in which an entity 
first applies the standard. For an entity with a calendar year end applying the 
standard for the first time as of the mandatory effective date, the date of initial 
application would be 1 January 2018; and
– a contract is a ‘completed contract’ if all of the goods or services identified 
in accordance with IAS 11, IAS 18 and related interpretations that the entity 
has an obligation to deliver and the customer has a right to receive have been 
transferred before the date of initial application. It appears that the assessment 
of whether a contract is complete should take into account the entity’s existing 
stated accounting policies.
IFRS 15.BC445E
It appears that if on initial application an entity has a deferred balance related to a 
completed contract, then it should continue to account for it in accordance with its 
existing accounting policy after the date of initial application.