Revenue – ifrs 15 handbook

Example 24 – Non-cash consideration: Measured at contract 
inception
Real Estate Developer D enters into a contract with Customer C to build an 
office block on C’s land. As consideration, D will receive 50,000 in quarterly 
instalments as construction progresses and a piece of C’s land adjacent to the 
construction site. The land title transfers to D up-front, but it is subject to recall if 
D defaults and does not complete the office block.
In this scenario, D determines that it is appropriate to measure the non-cash 
consideration at the date of contract inception.

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3 Step 3 – Determine the transaction price | 79
3.3 Non-cash consideration
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Example 25 – Non-cash consideration: Measured when the 
performance obligation is satisfied
Real Estate Developer R enters into a contract with Customer M for the sale 
of a unit in a new retirement village. The project is scheduled to take three 
years. Under the contract, R will receive an up-front payment of 20,000 and M’s 
existing house on completion of the unit. M retains all of the rights to occupy 
and pledge the house until the unit in the new retirement village is ready. R 
concludes that control over the unit transfers to M at the point in time when 
construction is completed.
In this scenario, R determines that it is appropriate to measure the non-cash 
consideration at the date when it satisfies the performance obligation.
Example 26 – Non-cash consideration: Free advertising
Production Company Y sells a television show to Television Company X. The 
consideration under the arrangement is a fixed amount of 1,000 and 100 
advertising slots. Y determines that the stand-alone selling price of the show 
would be 1,500. Based on market rates, Y determines that the fair value of the 
advertising slots is 600.
Y determines that the transaction price is 1,600, comprising the 1,000 fixed 
amount plus the fair value of the advertising slots. 
If the fair value of the advertising slots could not be reasonably estimated, then 
the transaction price would be 1,500 – i.e. Y would use the stand-alone selling 
price of the goods or services promised for the non-cash consideration in these 
circumstances.