BC16 During the early stages of their Revenue Recognition project, the boards considered various alternative revenue recognition models, including the following:
(a) the basis for recognising revenue - specifically, whether an entity should recognise revenue only when it transfers a promised good or service to a customer (a contract-based revenue recognition principle) or when (or as) the entity undertakes a productive activity (which could be an activity that is undertaken regardless of whether a contract exists); and
(b) the basis for measuring revenue - specifically, whether revenue should be measured at an allocated customer consideration amount (ie the transaction price) or at a current exit price.
Basis for recognising revenue
BC17 In the Discussion Paper, the boards proposed a principle to recognise revenue on the basis of the accounting for the asset or the liability arising from a contract with a customer. The boards had two reasons for developing a standard on revenue that ap
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