Revenue recognition · IFRS 15 · NRV 14ª
Income when it is earned, not only when it is invoiced
Since 2021 the Spanish PGC’s NRV 14ª has followed the five-step model of IFRS 15. aicroo implements that model on the PGC book, norm by norm, and leaves your invoices, VAT and VERI*FACTU as they are.
Each line below says where it stands.
The model
The five steps, and what aicroo does at each
Watched by
Bookkeeper
1
Identify the contract
The standard: An enforceable agreement with a customer.
aicroo: Subscriptions, fixed-price projects and rebate agreements are the contracts income is measured against.
2
Find what was promised
The standard: Each distinct good or service is an obligation of its own.
aicroo: The lines of a document, including a set-up fee or a bundle, each with its own income.
3
Set the price
The standard: Fixed amounts plus the best estimate of what varies, only as far as it will not reverse.
aicroo: Rappels, expected returns and prompt-payment discounts reduce income, and the rate never falls below what sales already support.
4
Allocate the price
The standard: Across the obligations, by what each sells for alone.
aicroo: A bundle or a discounted contract is split by each item’s standalone price, with an override per item.
5
Recognise income
The standard: As each obligation is met: over time, or at a point in time.
aicroo: The month-end close posts what changed, from its own run, cumulatively, so a late estimate catches itself up.
Norm by norm
Every norm, mapped to something the product does
| Standard | Spanish PGC | What aicroo does | Available |
|---|---|---|---|
| IFRS 15 · over time | NRV 14ª | A billed service spread over its period, month by month | Available |
| IFRS 15 · allocation by standalone selling price | NRV 14ª | A bundle split by what each part sells for alone | Available |
| IFRS 15 · contract balances | ICAC resolution, art. 33 | Ramps, free months and minimums evened out, with a contract asset or liability | Available |
| IFRS 15 · measuring progress | ICAC resolution, art. 9 and 11 | Fixed-price projects by cost, milestones or a certified percentage | Available |
| IAS 37 · onerous contracts | NRV 15ª | A contract losing money provided for when that becomes known | Available |
| IFRS 15 · variable consideration, the constraint | ICAC resolution, art. 13 and 34 | Rappels accrue with the sales, and the rate never falls below what sales support | Available |
| IFRS 15 · right of return | ICAC resolution, art. 24 | A refund provision and the right to the goods, never netted | Available |
| IFRS 15 · principal or agent | NRV 14ª | Sales as agent netted in the books, with the invoice left whole | Available |
| IFRS 15 · unexercised rights | ICAC resolution, art. 28 | Prepaid balances never used, recognised as the rest is redeemed | Available |
| IFRS 15 · contract costs | ICAC resolution, art. 33 | Costs of winning a long contract released over its term | Available |
| IFRS 15 · warranties, IAS 37 | NRV 15ª | An assurance warranty as a provision outside turnover | Available |
| IFRS 15 · disclosure | Memoria | Contract balance roll-forward, remaining obligations, revenue by timing | Available |
| IFRS 15 · revenue note | Over the PGC book | The PGC figures on the lines of an IFRS 15 note, with the differences beside them | Available |
| IFRS 15 · material rights | NRV 14ª | No loyalty points or renewal discounts yet to attach them to | Not covered |
What stays
Your invoices do not change
- Invoices keep their amounts, their VAT and their VERI*FACTU record. Income is corrected in the ledger, not on the document.
- An estimate moves no VAT. A rebate or a discount moves it only when the rectifying invoice is issued.
- A rebate by volume can settle with one rectifying invoice for the period, naming no invoice, as the invoicing regulation allows.
- A company with no agreement, no method and no policy sees no change at all.
Disclosure
The notes your accounts need, from the ledger
Watched by
CFO
Contract Balance Roll-forward
Opening, increases, decreases and closing of contract assets and liabilities, from the ledger.
Remaining Performance Obligations
What subscriptions and projects have agreed and not yet recognised, within twelve months and after.
Revenue by Timing
Turnover recognised over time against at a point in time.
IFRS 15 Revenue Note
The figures on the note’s lines, with any difference from the Spanish books beside them.
What this is not
Software alone does not settle whether accounts meet a standard. That is for you, your accountant and your auditor to judge. aicroo gives a note for IFRS 15, not a full IFRS set of accounts, and estimates stay yours to make and to explain.
IFRS and IAS are trademarks of the IFRS Foundation. The standards are named to describe the model; neither the IFRS Foundation nor the ICAC has assessed or endorsed aicroo.