TIAG perspectives on IFRS 15: Significant financing components

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PwC TIAG perspectives on IFRS 15

IFRS 15 – Significant financing components

This fourth installment of the series considers whether a contract contains a significant financing element.

Determining whether a financing component is significant will require judgement, and will depend on the individual facts and circumstances of the transaction. However the Standard does provide guidance on factors which indicate a timing difference is not a significant financing component, and also provides a practical expedient for short term contracts. These, and other considerations, are further discussed in this article.