In a previous article we went into detail about what Revenue Recognition is and why it is necessary.
At a practical level what are the common methods of recognising revenue and how can this be achieved from an administrative perspective?
In the previous article mentioned above we stated that:
“Revenue is to be recognised over the period in which the services were performed. This is fairly straightforward for services provided on a Time and Material basis.”
“When a project involves delivery of a product that has required services to develop the product, e.g. software, and the provision of services to the project can be estimated reliably, revenue associated with the project shall be recognised by reference to the stage of completion of the project at the end of the reporting period.”