Appendix C (AASB15_12-14_COMPmar20_07-21)

This appendix is an integral part of AASB 15 and has the same authority as the other parts of AASB 15.

An entity shall apply this Standard for annual reporting periods beginning on or after 1 January 2018. Earlier application is permitted. If an entity applies this Standard earlier, it shall disclose that fact.

Notwithstanding paragraph C1, this Standard applies to not-for-profit entities for annual reporting periods beginning on or after 1 January 2019. Earlier application is permitted, provided that AASB 1058 Income of Not-for-Profit Entities is also applied to the same period. If a not-for-profit entity applies this Standard earlier, it shall disclose that fact.

Notwithstanding paragraph AusC1.1, not-for-profit entities may elect not to apply this Standard to research grants until annual reporting periods beginning on or after 1 July 2019. If a not-for-profit entity applies this Standard to research grants prior to that, it shall also apply AASB 1058 to research grants at the same time.

AASB 16 Leases, issued in February 2016, amended paragraphs 5, 97, B66 and B70. An entity shall apply those amendments when it applies AASB 16.

AASB 2016-3 Amendments to Australian Accounting Standards – Clarifications to AASB 15, issued in May 2016, amended paragraphs 26, 27, 29, B1, B34–B38, B52–B53, B58, C2, C5 and C7, deleted paragraph B57 and added paragraphs B34A, B35A, B35B, B37A, B59A, B63A, B63B, C7A and C8A. An entity shall apply those amendments for annual reporting periods beginning on or after 1 January 2018. Earlier application is permitted. If an entity applies those amendments for an earlier period, it shall disclose that fact.

For the purposes of the transition requirements in paragraphs C3–C8A:

(a)            the date of initial application is the start of the reporting period in which an entity first applies this Standard; and

(b)            a completed contract is a contract for which the entity has transferred all of the goods or services identified in accordance with AASB 111 Construction Contracts, AASB 118 Revenue and related Interpretations.

In respect of not-for-profit entities, the reference in paragraph C2(b) to a completed contract also includes contracts for which the entity has recognised all of the revenue in accordance with AASB 1004 Contributions, or revenue in combination with a provision in accordance with AASB 137 Provisions, Contingent Liabilities and Contingent Assets.

An entity shall apply this Standard using one of the following two methods:

(a)            retrospectively to each prior reporting period presented in accordance with AASB 108 Accounting Policies, Changes in Accounting Estimates and Errors, subject to the expedients in paragraph C5; or

(b)            retrospectively with the cumulative effect of initially applying this Standard recognised at the date of initial application in accordance with paragraphs C7–C8.

Notwithstanding the requirements of paragraph 28 of AASB 108, when this Standard is first applied, an entity need only present the quantitative information required by paragraph 28(f) of AASB 108 for the annual reporting period immediately preceding the first annual reporting period for which this Standard is applied (the ‘immediately preceding period’) and only if the entity applies this Standard retrospectively in accordance with paragraph C3(a). An entity may also present this information for the current period or for earlier comparative periods, but is not required to do so.

An entity may use one or more of the following practical expedients when applying this Standard retrospectively in accordance with paragraph C3(a):

(a)            for completed contracts, an entity need not restate contracts that:

(i)             begin and end within the same annual reporting period; or

(ii)            are completed contracts at the beginning of the earliest period presented.

(b)            for completed contracts that have variable consideration, an entity may use the transaction price at the date the contract was completed rather than estimating variable consideration amounts in the comparative reporting periods.

(c)            for contracts that were modified before the beginning of the earliest period presented, an entity need not retrospectively restate the contract for those contract modifications in accordance with paragraphs 20–21. Instead, an entity shall reflect the aggregate effect of all of the modifications that occur before the beginning of the earliest period presented when:

(i)             identifying the satisfied and unsatisfied performance obligations;

(ii)            determining the transaction price; and

(iii)           allocating the transaction price to the satisfied and unsatisfied performance obligations.

(d)            for all reporting periods presented before the date of initial application, an entity need not disclose the amount of the transaction price allocated to the remaining performance obligations and an explanation of when the entity expects to recognise that amount as revenue (see paragraph 120).

For any of the practical expedients in paragraph C5 that an entity uses, the entity shall apply that expedient consistently to all contracts within all reporting periods presented. In addition, the entity shall disclose all of the following information:

(a)            the expedients that have been used; and

(b)            to the extent reasonably possible, a qualitative assessment of the estimated effect of applying each of those expedients.

If an entity elects to apply this Standard retrospectively in accordance with paragraph C3(b), the entity shall recognise the cumulative effect of initially applying this Standard as an adjustment to the opening balance of retained earnings (or other component of equity, as appropriate) of the annual reporting period that includes the date of initial application. Under this transition method, an entity may elect to apply this Standard retrospectively only to contracts that are not completed contracts at the date of initial application (for example, 1 January 2018 for an entity with a 31 December year-end).

An entity applying this Standard retrospectively in accordance with paragraph C3(b) may also use the practical expedient described in paragraph C5(c), either:

(a)            for all contract modifications that occur before the beginning of the earliest period presented; or

(b)            for all contract modifications that occur before the date of initial application.

If an entity uses this practical expedient, the entity shall apply the expedient consistently to all contracts and disclose the information required by paragraph C6.

For reporting periods that include the date of initial application, an entity shall provide both of the following additional disclosures if this Standard is applied retrospectively in accordance with paragraph C3(b):

(a)            the amount by which each financial statement line item is affected in the current reporting period by the application of this Standard as compared to AASB 111, AASB 118 and related Interpretations that were in effect before the change; and

(b)            an explanation of the reasons for significant changes identified in C8(a).

An entity shall apply AASB 2016-3 Amendments to Australian Accounting Standards – Clarifications to AASB 15 (see paragraph C1B) retrospectively in accordance with AASB 108. In applying the amendments retrospectively, an entity shall apply the amendments as if they had been included in AASB 15 at the date of initial application. Consequently, an entity does not apply the amendments to reporting periods or to contracts to which the requirements of AASB 15 are not applied in accordance with paragraphs C2–C8. For example, if an entity applies AASB 15 in accordance with paragraph C3(b) only to contracts that are not completed contracts at the date of initial application, the entity does not restate the completed contracts at the date of initial application of AASB 15 for the effects of these amendments.

If an entity applies this Standard but does not yet apply AASB 9 Financial Instruments, any reference in this Standard to AASB 9 shall be read as a reference to AASB 139 Financial Instruments: Recognition and Measurement.

[Deleted by the AASB]

When applied or operative, this Standard supersedes:

(a)            AASB 111 Construction Contracts;

(b)            AASB 118 Revenue;

(c)            Interpretation 13 Customer Loyalty Programmes;

(d)            Interpretation 15 Agreements for the Construction of Real Estate;

(e)            Interpretation 18 Transfers of Assets from Customers;

(f)             Interpretation 131 Revenue – Barter Transactions Involving Advertising Services; and

(g)            Interpretation 1042 Subscriber Acquisition Costs in the Telecommunications Industry.