IAS 11 Construction Contracts

Description

Revision of the IAS 11 Construction Contract accounting standard
Yaz Davies
Mind Map by Yaz Davies, updated more than 1 year ago
Yaz Davies
Created by Yaz Davies over 10 years ago
132
3

Resource summary

IAS 11 Construction Contracts
  1. Fixed Price
    1. Cost Plus
      1. Conflict between
        1. Prudence

          Annotations:

          • Prudence would require that no income or profits are anticipated until realised
          1. Matching

            Annotations:

            • Matching requires that costs are matched to the income they generate in the same period
            1. Fair presentation

              Annotations:

              • The income statement should be a fair presentation of an entity's position therefore matching wins
            2. Contracts for more than one year

              Annotations:

              • watch out for this, just because the word construction is used does not mean it constitutes a construction contract under IAS 11
              1. Contract Revenue
                1. Reasonable Certainty

                  Annotations:

                  • where income cannot be estimated with reasonable certainty, the income statement must still reflect the activity for the period and as such revenue is matched against cost showing no profit or loss Payments on account DO NOT represent the revenue figure
                  1. Proportion of Work Done

                    Annotations:

                    • Work is certified by professional surveyors.
                    1. Specific points
                      1. Profitable Contracts

                        Annotations:

                        • Contract profit is usually recognised based on the percentage of work completed and the cost of sales becomes the balancing figure
                        1. Cost of Sale

                          Annotations:

                          • Crucial Exam point, calculated as a balancing figure
                      Show full summary Hide full summary

                      Similar

                      GCSE PE - 1
                      lydia_ward
                      Study Plan
                      mlanders
                      CPU and Memory
                      LunaLovegood
                      Additional Chemistry - Topic 1: Atomic Structure and the Periodic Table
                      Hollieee01
                      Deutsch Wortschatz A1C
                      Ericka C
                      Hitler's Chancellorship
                      c7jeremy
                      Main Themes in Romeo and Juliet
                      Carlowl
                      Biology -B2
                      Sian Griffiths
                      Trigonometry, Equations, Pythagoras theorem
                      Caitlin Mortlock
                      CCNA Security 210-260 IINS - Exam 2
                      Mike M
                      BM 13 - COMENIUS, HERBART, DEWEY, HÖNIGSWALD
                      christoph wimmer