Revenue – ifrs 15 handbook

Transaction price may include amounts not paid by the customer
IFRS 15.47, BC187
The transaction price may include amounts that are not paid by the customer. 
For example, a healthcare company may include amounts to be received 
from the patient, insurance companies and government organisations in 
determining the transaction price. In another example, a retailer may include 
in the transaction price amounts received from a manufacturer as the result of 
coupons or rebates issued by the manufacturer directly to the end customer.
Transaction price may include fair value of derivative on 
settlement date
IU 03-19
The transaction price may include the fair value of a derivative on the settlement 
date of a sales contract that does not meet the ‘own use’ scope exception in the 
financial instruments standard. For example, an entity may enter into a contract 
to sell non-financial items that fall in the scope of the financial instruments 
standard. The entity accounts for the contract as a derivative measured at fair 
value through profit or loss. At the settlement date, the entity physically settles 
the contract by delivering the non-financial items. If the entity’s accounting 
policy for such contracts is to recognise revenue for the sale of non-financial 
items on a gross basis, then the transaction price includes cash received and 
the fair value of the derivative on the settlement date.
3.1
Variable consideration (and the constraint)
IFRS 15.51–52
Items such as discounts, rebates, refunds, rights of return, early settlement 
discounts, credits, price concessions, incentives, performance bonuses, penalties 
or similar items may result in variable consideration. Promised consideration 
can also vary if it is contingent on the occurrence or non-occurrence of a future 
event – e.g. the sale of an office building in which the consideration depends on 
the level of occupancy of the building at a future date. Variability may be explicit 
or implicit, arising from customary business practices, published policies or 
specific statements, or any other facts and circumstances that would create a valid 
expectation by the customer.

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48 | Revenue – IFRS 15 handbook
IFRS 15.53, 56, 58
An entity assesses whether, and to what extent, it can include an amount of variable 
consideration in the transaction price at contract inception. The following flowchart 
sets out how an entity determines the amount of variable consideration in the 
transaction price, except for sales- or usage-based royalties from licences of IP (see 
Section 9.6
).
Include the amount in the transaction price