Canada - English


  • Service: Topics
  • Industry: International Financial Reporting Standards (IFRS), Technology, Media and Telecommunications, Telecommunications
  • Type: Business and industry issue, White paper
  • Date: 3/14/2011

Revenue recognition for telecoms 

In June 2010, the IASB and the US FASB published an exposure draft on revenue from contracts with customers. The exposure draft included proposals to replace existing guidance under both IFRSs and US GAAP and proposes a single principles-based model under which an entity would recognize revenue as it satisfies the performance obligations in contracts with customers.
Revenue recognition for telecoms
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Communications companies have identified a number of topics that are consistent themes in their comments on the exposure draft to the Boards. Revenue Recognition for Telecoms summarizes some key concerns and suggestions made by telecoms in their comment letter responses to the Boards.


In general, respondents were supportive of a single revenue recognition model that could be applied across industries. Respondents had concerns in the following areas:


  • Some of the proposals are not considered appropriate, e.g. expensing costs of obtaining a contract and including credit risk in the measure of revenue
  • Some of the proposals would be difficult to apply in practice, e.g. applying the proposals to individual customer contracts
  • There is a lack of explicit accounting guidance for telecoms, e.g. contingent fees
  • There is a lack of application guidance in some cases, e.g. in assessing the transfer of control for service contracts.

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