01 — Concept
What is Revenue in Accounting?
Revenue is the gross inflow of economic benefits arising in the course of ordinary activities of an entity when those inflows result in increases in equity, other than increases relating to contributions from equity participants.
5
Steps in Ind AS 115 Model
2018
Ind AS 115 Effective (India)
SSP
Standalone Selling Price Basis
POB
Performance Obligation Based
📘 Key Definition (Ind AS 115.47): Revenue is recognised when (or as) a performance obligation is satisfied — i.e., when control of the promised good or service is transferred to the customer, at the amount of transaction price allocated to that performance obligation.
02 — Old vs New Standard
AS 9 vs Ind AS 115 — What Changed?
India moved from the risk-and-reward model (AS 9) to a control-based, performance-obligation-centric model (Ind AS 115), aligning with IFRS 15 globally.
Legacy — AS 9
Risk & Reward Model
- Revenue recognised when risks and rewards transfer
- Separate standards for goods, services, royalties
- No concept of "performance obligations"
- No guidance on multiple-element arrangements
- No variable consideration framework
- Percentage-of-completion for services only
Current — Ind AS 115
Control-Based 5-Step Model
- Revenue recognised when control transfers
- Single standard for all contracts with customers
- Identify all performance obligations (POBs)
- Allocate transaction price to each POB
- Detailed variable consideration rules (constraint)
- Point-in-time OR over-time recognition
03 — The 5-Step Model
The Ind AS 115 Five-Step Framework
Every revenue transaction must pass through these five steps. The model applies to all contracts with customers across all industries — goods, services, licensing, construction, SaaS, and more.
STEP 1
01
Identify the Contract
Must be approved, have commercial substance, identify rights & payment terms, and collection must be probable.
STEP 2
02
Identify Performance Obligations
Distinct goods or services promised. Each distinct POB is accounted for separately.
STEP 3
03
Determine Transaction Price
Include variable consideration (best estimate/expected value), constrained to amount highly probable of no reversal.
STEP 4
04
Allocate Transaction Price
Allocate to each POB based on relative standalone selling price (SSP).
STEP 5
05
Recognise Revenue
When (or as) each POB is satisfied — at a point-in-time or over time, when control transfers.
04 — Practical Example 1
Case Study: Software + AMC Bundle
One of the most common revenue recognition challenges — a company sells a product bundled with after-sales service. How is the transaction price split and when is revenue recognised?
FACTS OF THE CASE
TechEdge sells an ERP software licence bundled with a 1-year AMC for a combined contract price of ₹12,00,000. The company sells the software licence standalone at ₹10,00,000 and the AMC standalone at ₹2,50,000. Contract signed on 1 April 2024; AMC covers 12 months; customer pays full amount upfront.
Step 2 — Two distinct POBs identified: (i) Software Licence and (ii) Annual Maintenance Contract. Each is distinct because the customer can benefit from each separately, and they are separately identifiable.
Step 3 — Transaction Price: ₹12,00,000 (no variable consideration; no financing component).
STEP 4 — ALLOCATE TO PERFORMANCE OBLIGATIONS
| Performance Obligation |
Standalone Selling Price (SSP) |
SSP Ratio |
Allocated Amount (₹) |
Recognition Pattern |
| Software Licence |
₹10,00,000 |
80% |
₹9,60,000 |
Point-in-time (delivery) |
| AMC (12 months) |
₹2,50,000 |
20% |
₹2,40,000 |
Over time (monthly ₹20,000) |
| Total |
₹12,50,000 |
100% |
₹12,00,000 |
— |
Note: Total SSP (₹12.5L) > Contract Price (₹12L) — the ₹50,000 discount is allocated pro-rata as above.
STEP 5 — JOURNAL ENTRIES
Entry 1: On Receipt of Advance (1 April 2024)
Day 0
| Account | Dr/Cr | Debit (₹) | Credit (₹) |
|---|
| Bank / Cash A/c | Dr | 12,00,000 | — |
| To Contract Liability A/c (Deferred Revenue) | Cr | — | 12,00,000 |
| Total | 12,00,000 | 12,00,000 |
Being advance received from customer on signing ERP + AMC contract. Since performance obligations not yet satisfied, amount is deferred as a Contract Liability under Ind AS 115.
Entry 2: Software Licence Revenue (On Delivery, 5 April 2024)
Point-in-Time
| Account | Dr/Cr | Debit (₹) | Credit (₹) |
|---|
| Contract Liability A/c (Deferred Revenue) | Dr | 9,60,000 | — |
| To Revenue from Contracts with Customers A/c | Cr | — | 9,60,000 |
| Total | 9,60,000 | 9,60,000 |
Being revenue recognised on transfer of control of ERP software licence to customer — allocated amount ₹9,60,000 recognised at point-in-time on delivery. Contract Liability reduced accordingly. (Ind AS 115)
Entry 3: AMC Revenue — Each Month (April, May, … March)
Monthly — Over Time
| Account | Dr/Cr | Debit (₹) | Credit (₹) |
|---|
| Contract Liability A/c (Deferred Revenue) | Dr | 20,000 | — |
| To Revenue from Contracts with Customers A/c | Cr | — | 20,000 |
| Total | 20,000 | 20,000 |
Being 1/12th of AMC revenue recognised each month as the service is rendered over the 12-month contract period. ₹2,40,000 ÷ 12 = ₹20,000 per month. Performance obligation satisfied over time — straight-line basis. (Ind AS 115.39)
05 — Practical Example 2
Case Study: Variable Consideration — Sales with Returns
Variable consideration arises when the contract price is not fixed — discounts, rebates, refunds, incentives, or performance bonuses. Ind AS 115 requires the "constraint" to be applied before recognising variable amounts.
FACTS OF THE CASE
RetailMart Consumer Goods Ltd. — Trade Sales with Right of Return
RetailMart sells 1,000 units of a consumer product to a distributor at ₹500 per unit = ₹5,00,000 total. The distributor has the right to return unsold stock within 60 days. Based on historical data, 5% of units (50 units) are expected to be returned. Cost per unit is ₹300. Revenue from the expected return is NOT recognised; instead a refund liability and a right to returned goods asset are recorded.
| Item |
Calculation |
Amount (₹) |
Accounting Treatment |
| Revenue Recognised |
950 units × ₹500 |
4,75,000 |
Recognised in P&L |
| Refund Liability |
50 units × ₹500 |
25,000 |
Liability on Balance Sheet |
| Right to Returned Goods (Asset) |
50 units × ₹300 (cost) |
15,000 |
Asset on Balance Sheet |
| COGS Recognised |
950 units × ₹300 |
2,85,000 |
Expense in P&L |
Journal Entry: Sale with Expected Returns (Ind AS 115)
On Sale Date
| Account | Dr/Cr | Debit (₹) | Credit (₹) |
|---|
| Trade Receivables / Bank A/c | Dr | 5,00,000 | — |
| To Revenue from Contracts with Customers | Cr | — | 4,75,000 |
| To Refund Liability A/c | Cr | — | 25,000 |
| Total | 5,00,000 | 5,00,000 |
Being revenue recognised for 950 units (net of expected returns of 50 units at ₹500). Refund Liability of ₹25,000 recognised for estimated returns. Separate entry: Dr Right to Returned Goods A/c ₹15,000 | Cr COGS ₹15,000 (for the expected returned inventory). (Ind AS 115.B21)
06 — Practical Example 3
Case Study: Construction Contract — Over-Time Recognition
Long-term construction contracts are recognised over time using an appropriate measure of progress (input or output method). This is one of the most significant changes from the old AS 7 / Percentage Completion approach.
| Year |
Cumulative Cost Incurred (₹) |
Total Estimated Cost (₹) |
% Completion |
Contract Price (₹) |
Cumulative Revenue (₹) |
Revenue This Year (₹) |
| Year 1 | 1,20,00,000 | 4,00,00,000 |
30% |
5,00,00,000 | 1,50,00,000 |
1,50,00,000 |
| Year 2 | 2,40,00,000 | 4,00,00,000 |
60% |
5,00,00,000 | 3,00,00,000 |
1,50,00,000 |
| Year 3 | 4,00,00,000 | 4,00,00,000 |
100% |
5,00,00,000 | 5,00,00,000 |
2,00,00,000 |
Over-Time Criteria Met (Ind AS 115.35c): The customer controls the asset as it is created (the road is built on government land; the customer takes possession of each section progressively). Therefore the POB is satisfied over time, and revenue is recognised using input method (cost-to-cost).
Journal Entry: Year 1 — Construction Revenue Recognition
Year-End Entry · Ind AS 115
| Account | Dr/Cr | Debit (₹) | Credit (₹) |
|---|
| Contract Asset A/c (Unbilled Revenue) | Dr | 1,50,00,000 | — |
| To Revenue from Contracts with Customers | Cr | — | 1,50,00,000 |
| Total | 1,50,00,000 | 1,50,00,000 |
Being revenue recognised for Year 1 based on 30% completion (cost incurred ₹1.2Cr ÷ total estimated cost ₹4Cr). Revenue = 30% × ₹5Cr = ₹1.5Cr. Contract Asset recognised as the entity has an unconditional right to consideration only upon milestone billing. (Ind AS 115.107-108)
07 — Key Concepts
Critical Revenue Concepts to Know
📄
Contract Asset vs Contract Liability
A Contract Asset arises when the entity has performed (transferred goods/services) but has not yet billed the customer. A Contract Liability (Deferred Revenue) arises when the customer has paid before the entity has performed. These are not receivables or payables in the traditional sense — they are revenue timing adjustments.
💰
Transaction Price — Inclusions & Exclusions
Transaction price includes: fixed consideration, variable consideration (constrained), non-cash consideration, and consideration payable to customer (reduces transaction price). It excludes amounts collected on behalf of third parties (e.g., GST, TCS).
⏱
Financing Component — Significant Financing
If the timing of payment provides significant financing to either party, the transaction price must be adjusted for the time value of money. Practical expedient: no adjustment needed if the period between transfer and payment is ≤ 12 months.
Adjusted Revenue = Cash Selling Price | Interest: Dr/Cr Finance Cost or Finance Income
🔑
Principal vs Agent (Gross vs Net Revenue)
Principal: Controls the good/service before transfer → recognises revenue GROSS. Agent: Arranges for someone else to provide → recognises only the fee/commission (NET). Misclassifying principal vs agent inflates or deflates revenue — a common audit focus area.
🏷
Costs to Obtain & Fulfil a Contract
Incremental costs to obtain a contract (e.g., sales commissions) are capitalised as an asset and amortised over the expected contract period — unless the amortisation period ≤ 12 months (practical expedient to expense). Similarly, costs to fulfil a contract that generate future performance must be capitalised.
08 — Balance Sheet Impact
Revenue's Impact on the Balance Sheet
Revenue recognition under Ind AS 115 creates several unique balance sheet line items that did not exist under the old standards. Understanding these is essential for reading financial statements correctly.
| Balance Sheet Line Item |
Nature |
Arises When |
Presented As |
Example |
| Trade Receivables |
Asset |
Revenue recognised + billed; unconditional right to receive |
Current Assets |
Invoice issued to customer |
| Contract Asset (Unbilled) |
Asset |
Revenue recognised but NOT yet billed (conditional) |
Current Assets |
30% completion but invoice not raised |
| Contract Liability (Deferred Revenue) |
Liability |
Cash received but performance obligation not yet fulfilled |
Current Liabilities |
Annual subscription fee paid upfront |
| Refund Liability |
Liability |
Expected returns / variable consideration reversals |
Current Liabilities |
Returns provision under variable consideration |
| Right to Returned Goods |
Asset |
Expected customer returns (at cost) |
Current Assets (Inventory) |
Goods expected to be returned by distributor |
| Capitalised Contract Costs |
Asset |
Costs to obtain/fulfil a contract (if amortisation > 12 months) |
Non-current / Current Assets |
Sales commission for 3-year SaaS contract |
09 — Disclosures
Key Disclosures Required (Ind AS 115)
Disaggregation of Revenue (Para 114): Revenue must be disaggregated into categories that depict how the nature, amount, timing and uncertainty of revenue differ — e.g., by product/service type, geography, customer type, contract duration (short-term vs long-term), and timing (over-time vs point-in-time).
Contract Balances (Para 116): Opening and closing balances of contract assets and liabilities, and revenue recognised from opening contract liabilities. Reconciliation is required if material.
Remaining Performance Obligations (Para 120): For contracts with original duration > 1 year, disclose the aggregate transaction price allocated to unsatisfied performance obligations and the expected timing of recognition.
Significant Judgements (Para 123): Disclose judgements made — e.g., timing of satisfaction of POBs, methods used to measure progress, determination of transaction price (especially variable consideration), allocation methods (SSP), and principal vs agent conclusions.
10 — FAQ
Frequently Asked Questions
Can revenue ever be recognised before invoicing?
Yes. Under Ind AS 115, if the entity has transferred control of goods/services but has not yet invoiced the customer, a Contract Asset (Unbilled Revenue) is recognised. Revenue is recognised based on performance, not billing. This is a key difference from legacy standards. For example, in long-term projects, revenue is recognised monthly based on completion even if invoicing is quarterly.
What is the difference between a Contract Asset and a Trade Receivable?
A Trade Receivable is an unconditional right to receive cash — only the passage of time is needed. A Contract Asset is a conditional right — the entity still needs to satisfy additional performance obligations before billing. Trade receivables are subject to ECL impairment under Ind AS 109; contract assets are also subject to ECL, but using a lifetime ECL approach from initial recognition.
How is GST treated in revenue recognition?
GST collected from customers is excluded from revenue entirely — it is not part of the transaction price. The entity acts as an agent for the government in collecting GST. Revenue is always reported net of GST. The GST collected is a liability (Output GST) until deposited with the government. This is consistent with Ind AS 115's exclusion of amounts collected on behalf of third parties.
When should variable consideration be constrained?
Variable consideration (discounts, rebates, bonuses, penalties) is included in the transaction price only to the extent it is highly probable that a significant reversal of cumulative revenue will not occur. This is called the "constraint." Factors indicating higher risk of reversal include: highly susceptible to external factors, limited experience, broad range of outcomes, and long time horizon before resolution. Management must reassess every reporting period.
What is a "distinct" performance obligation?
A good or service is distinct if: (i) the customer can benefit from it on its own or with other readily available resources (capable of being distinct), AND (ii) it is separately identifiable from other promises in the contract (distinct in the context of the contract). If bundled goods/services are highly interdependent, they may form a single combined POB. The software + installation example: if the installation requires significant integration effort unique to the software, they may be a single POB.
11 — Industry-Specific Revenue
Revenue Recognition by Industry
The 5-step model applies universally, but its application varies significantly across industries. Here's how key sectors in India handle revenue recognition under Ind AS 115.
💻
IT / SaaS Companies
Multiple POBs are common: software licence, implementation, training, AMC. Each must be identified, priced at SSP, and recognised separately. SaaS subscriptions are recognised over time (straight-line). Customisation may be a separate POB or combined with implementation if highly interdependent.
Over-Time
SSP Allocation Critical
🏗
Real Estate Developers
Revenue from under-construction flats is recognised at a point-in-time (on registration/handover) for most projects — unless the customer controls the asset as it is created (land owned by buyer, no alternative use, enforceable payment right). RERA agreements and advance bookings create Contract Liabilities until completion.
Point-in-Time (mostly)
High Contract Liabilities
🏭
Manufacturing / FMCG
Revenue is recognised at point-in-time when control transfers (typically on dispatch or delivery per Incoterms). Variable consideration from trade discounts, volume rebates, and promotional schemes must be estimated and constrained. Principal vs agent analysis applies to consignment arrangements.
Point-in-Time
Variable Consideration
⚡
Telecom Companies
Bundled plans (handset + data + voice) are classic multiple-POB arrangements. The handset is recognised at point-in-time on delivery; airtime/data is recognised over time. Upfront connection fees are allocated to POBs or deferred. Loyalty reward programmes require significant judgement on deferral.
Mixed Recognition
Loyalty Programme Complexity
🏦
Financial Services (Non-Ind AS 109)
Fee income from advisory services, fund management, and wealth management is governed by Ind AS 115. Upfront fees may need to be deferred if they relate to ongoing services. Performance-linked fees (carried interest) are constrained until highly probable. Transaction-based fees are recognised at point-in-time.
Variable Consideration
Constraint Critical
🛒
E-Commerce / Marketplaces
The most critical question is principal vs agent. If the platform controls the goods before transfer to buyer → gross revenue. If merely facilitating → net commission. Returns policy creates variable consideration. Gift vouchers / wallet credits are Contract Liabilities until redeemed or expired (breakage).
Principal vs Agent Key
Breakage Accounting
12 — Common Errors & Audit Traps
Frequent Mistakes in Revenue Accounting
These are the most common errors flagged by auditors and regulators in Ind AS 115 compliance reviews. Each one can materially misstate revenue.
ERR-01
Recognising Bundled Revenue Entirely at Delivery
When a company sells a product + service bundle, recognising the full contract price at delivery of the product ignores the remaining performance obligation (AMC, support). This overstates current-period revenue and understates deferred revenue on the balance sheet.
✓ Fix: Identify all POBs, allocate at SSP, defer service component as Contract Liability.
ERR-02
Not Constraining Variable Consideration
Recognising the full contract price when discounts, rebates, or performance bonuses are uncertain violates the constraint principle. This front-loads revenue and leads to significant reversals in later periods — a red flag for auditors.
✓ Fix: Apply the constraint test — include variable amounts only when highly probable of no significant reversal.
ERR-03
Treating All Long-Term Contracts as Over-Time
Not all long-term contracts qualify for over-time recognition. An entity must meet at least one of three criteria (customer simultaneously receives and consumes; entity creates/enhances asset customer controls; no alternative use + enforceable payment right). Failing all three means point-in-time recognition.
✓ Fix: Evaluate each contract against Ind AS 115.35 criteria before applying over-time recognition.
ERR-04
Ignoring the Significant Financing Component
Where the gap between payment and delivery exceeds 12 months, the transaction price must be adjusted to reflect the time value of money. Ignoring this understates revenue and interest income/expense, distorting both P&L and the effective interest rate.
✓ Fix: Discount / accrete transaction price using the customer's borrowing rate. Recognise interest separately.
ERR-05
Gross vs Net Revenue Misclassification
Recognising revenue gross when the entity acts as an agent (e.g., marketplace, intermediary) inflates both revenue and cost of sales. This is a common audit focus, especially in e-commerce, travel portals, and distribution businesses.
✓ Fix: Apply the control test — does the entity control the good/service before transfer to customer? If not, recognise net.
ERR-06
Not Recognising Contract Acquisition Costs as Assets
Sales commissions paid on contracts with a duration > 12 months must be capitalised and amortised — not expensed immediately. Immediate expensing understates assets and front-loads expenses, resulting in uneven profit recognition over the contract life.
✓ Fix: Capitalise incremental costs of obtaining contracts. Amortise on a basis consistent with the transfer of related services.
13 — Practical Example 4
Case Study: Telecom Bundled Plan — Handset + Data
This is one of the most discussed Ind AS 115 applications in India — how telecom operators account for subsidised handsets bundled with data plans.
ConnectIndia offers a 24-month plan: customer pays ₹1,000/month (total ₹24,000) and receives a smartphone (standalone price ₹18,000) + 24 months unlimited data (standalone price ₹400/month = ₹9,600 total). The handset is delivered on Day 1; data service runs for 24 months.
Total SSP: ₹18,000 (handset) + ₹9,600 (data) = ₹27,600 | Contract Price: ₹24,000 | Bundle Discount: ₹3,600 (allocated pro-rata)
| POB | SSP (₹) | SSP% | Allocated Price (₹) | Recognition |
| Smartphone (Handset) |
18,000 | 65.2% |
15,652 |
Day 1 — Point-in-Time |
| Data Service (24 months) |
9,600 | 34.8% |
8,348 |
₹348/month — Over Time |
| Total | 27,600 | 100% |
24,000 | — |
Key Impact: On Day 1, ConnectIndia recognises ₹15,652 revenue for the handset (even though only ₹1,000 cash is received in Month 1). A Contract Asset of ₹14,652 is created — representing the entity's right to future payments attributable to the already-delivered handset. This is a major balance sheet item for large telecom operators.
Entry 1: Day 1 — Handset Delivery (Point-in-Time Revenue)
Day 0 · POB 1 Satisfied
| Account | Dr/Cr | Debit (₹) | Credit (₹) |
|---|
| Contract Asset A/c (Unbilled — Handset) | Dr | 15,652 | — |
| To Revenue from Contracts with Customers | Cr | — | 15,652 |
| Total | 15,652 | 15,652 |
Being revenue recognised on Day 1 for handset POB satisfied — allocated amount ₹15,652. Contract Asset raised as the entity has a conditional right to ₹1,000/month cash; the excess over first instalment (₹14,652) is unbilled. (Ind AS 115.105)
Entry 2: Each Month — Cash Receipt + Data Revenue
Monthly Entry · 24 Months
| Account | Dr/Cr | Debit (₹) | Credit (₹) |
|---|
| Bank A/c | Dr | 1,000 | — |
| To Contract Asset A/c (Handset Recovery) | Cr | — | 652 |
| To Revenue from Contracts with Customers (Data) | Cr | — | 348 |
| Total | 1,000 | 1,000 |
Being monthly cash receipt of ₹1,000 allocated: ₹652 reduces Contract Asset (handset recovery = ₹15,652 ÷ 24 months) and ₹348 recognised as data service revenue (₹8,348 ÷ 24 months). Over 24 months, Contract Asset fully extinguishes. (Ind AS 115)
14 — Quick Reference
Revenue Recognition Decision Checklist
Use this checklist for every new contract or arrangement to ensure complete Ind AS 115 compliance before recognising any revenue.
STEP 1–2 · Contract & Performance Obligations
☐ Does the contract have commercial substance and are all parties committed?
☐ Is collection of the consideration probable?
☐ Have all promised goods and services been listed?
☐ Is each good/service capable of being distinct (on its own)?
☐ Is each good/service distinct in the context of the contract?
☐ Have POBs been combined where goods/services are highly interdependent?
STEP 3 · Transaction Price
☐ Is there any variable consideration (discounts, rebates, bonuses, penalties, returns)?
☐ Has the constraint been applied to variable consideration?
☐ Is there a significant financing component (payment timing > 12 months)?
☐ Is there any consideration payable to the customer (reduces transaction price)?
☐ Is GST / TCS excluded from transaction price?
STEP 4 · Allocation
☐ Has SSP been determined for each POB (observable or estimated)?
☐ Has any bundle discount been allocated pro-rata (unless specific allocation applies)?
☐ Are variable amounts allocated to specific POBs where criteria are met?
STEP 5 · Recognition
☐ Does the POB meet any of the three over-time criteria (Ind AS 115.35)?
☐ If over-time — is the progress measure (input/output) appropriate and consistent?
☐ If point-in-time — has control transferred (physical possession, legal title, risks & rewards, acceptance)?
☐ Have Contract Assets / Contract Liabilities been correctly recorded?
DISCLOSURES & COSTS
☐ Has revenue been disaggregated into appropriate categories in the notes?
☐ Have opening and closing Contract Asset / Liability balances been disclosed?
☐ Have remaining performance obligations (> 1 year) been quantified and disclosed?
☐ Have incremental contract acquisition costs been capitalised if amortisation period > 12 months?
☐ Have significant judgements been disclosed (timing, methods, SSP, principal vs agent)?
15 — Summary Table
Revenue Recognition — At-a-Glance Summary
A consolidated reference of the most important revenue accounting scenarios, their treatment, and the corresponding balance sheet impact.
| Scenario |
POBs |
Recognition Timing |
Contract Asset / Liability |
Key Standard Para |
| Sale of goods (FOB dispatch) |
1 |
Point-in-Time |
Trade Receivable |
Ind AS 115.38 |
| Software + AMC bundle |
2+ |
Mixed |
Contract Liability (AMC portion) |
Ind AS 115.22–30 |
| Construction contract |
1 (over time) |
Over-Time |
Contract Asset (unbilled) |
Ind AS 115.35 |
| Advance received before delivery |
1 |
Point-in-Time (future) |
Contract Liability (Deferred Revenue) |
Ind AS 115.106 |
| Sale with right of return |
1 |
Partial Point-in-Time |
Refund Liability + Right to Goods Asset |
Ind AS 115.B20–B27 |
| Telecom handset + data bundle |
2 |
Mixed |
Contract Asset (handset unbilled) |
Ind AS 115.74–86 |
| Licence of IP (right to use) |
1 |
Point-in-Time |
Trade Receivable |
Ind AS 115.B58–B62 |
| Licence of IP (right to access) |
1 |
Over-Time |
Contract Asset (if unbilled) |
Ind AS 115.B58–B62 |
| Agency / marketplace commission |
1 (net) |
Point-in-Time |
Trade Receivable (net fee only) |
Ind AS 115.B34–B38 |
| Annual subscription (SaaS) |
1 |
Over-Time (monthly) |
Contract Liability (deferred subscription) |
Ind AS 115.35(a) |
| Performance bonus / success fee |
1 (variable) |
Constrained Until Probable |
None until constraint lifted |
Ind AS 115.56–58 |
| Bill-and-hold arrangement |
1 |
Point-in-Time (if criteria met) |
Trade Receivable (if criteria met) |
Ind AS 115.B81–B82 |
📌 Remember: Revenue standard Ind AS 115 applies to all contracts with customers, regardless of industry or type of consideration. Contracts within the scope of Ind AS 109 (financial instruments), Ind AS 116 (leases), and Ind AS 17 (insurance) are excluded from Ind AS 115.