BC354 Previous requirements in IFRS and US GAAP require entities to disclose their accounting policies for recognising revenue (see paragraph 10(e) of IAS 1 [When it issued IFRS 18, the IASB carried over the requirements to disclose material accounting policy information from IAS 1 to IAS 8.] and the requirements in Topic 235 Notes to Financial Statements). However, users of financial statements suggested that in many cases, an entity provides a ‘boilerplate' description of the accounting policy adopted without explaining how the accounting policy relates to the contracts that the entity enters into with customers. To address this criticism, paragraph 119 of IFRS 15 requires that an entity disclose information about its performance obligations in contracts with customers. This disclosure complements the accounting policy disclosure requirements in existing Standards by requiring an entity to provide more descriptive information about its performance obligations.
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