Revenue Recognition Paradox: A Review of IAS 18 and IFRS 15

25 Pages Posted: 6 Feb 2017

See all articles by Prof. Godwin Emmanuel Oyedokun

Prof. Godwin Emmanuel Oyedokun

Lead City University Ibadan Nigeria ; OGE Professional Services Ltd; Nasarawa State University, Keffi

Date Written: May 24, 2016

Abstract

The primary purpose of venturing into business is to make profit, this motive, however, have been criticised widely. The concept of income is crucial to the entity's financial performance, and is half of determining an organisation's profitability and sustainability. The treatment of "revenue" is particularly important when recognising income; revenue being income that is derived from an organisation's everyday operating activities. The objective of this paper is to review the provisions of the International Accounting Standards (IAS) 18 and International Financial Reporting Standards IFRS 15 with respect to revenue recognition. The basic foundation of the principles of how to deal with income, how to recognise revenue and other forms of income in the financial statements, the basis of IAS 18 to help the transition when IFRS 15 replaces it, and how to account for and disclose provisions of grants by government and other forms of government assistance were reviewed in this paper by adopting contents analysis methodology. The paper revealed the importance of IFRS and recommend that the users and preparers of financial statement should start in earnest, the training and understanding of IFRS 15 in readiness for its effective date January 1, 2017.

Keywords: IFRS, Revenue, Disclosure, Government Grant, Contacts, Financial Statements

JEL Classification: M40, M41, M49

Suggested Citation

Oyedokun, Godwin Emmanuel, Revenue Recognition Paradox: A Review of IAS 18 and IFRS 15 (May 24, 2016). Available at SSRN: https://ssrn.com/abstract=2912250 or http://dx.doi.org/10.2139/ssrn.2912250

Godwin Emmanuel Oyedokun (Contact Author)

Lead City University Ibadan Nigeria ( email )

Ibadan
Nigeria
+2348033737184 (Phone)

HOME PAGE: http://www.oyedokungodwin.com

OGE Professional Services Ltd ( email )

2nd Floor, Back Wing, 28, Adeyemi Street, Off LUT
Mushin, Lagos
Nigeria

Nasarawa State University, Keffi ( email )

Department of Accounting
Faculty of Administration
Keffi, Nasarawa 234
Nigeria
+23480833737184 (Phone)

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