{"id":"F2005B01542","name":"AASB 118 - Revenue - July 2004","slug":"aasb-118-revenue-july-2004","collection":"legislative_instrument","jurisdiction":"commonwealth","status":"repealed","isInForce":false,"actNumber":null,"makingDate":null,"administeringDepartment":null,"currentVersion":{"id":32620,"registerId":"commonwealth-F2005B01542-current","compilationNumber":null,"startDate":"2026-04-01","status":"Repealed","reasons":null,"registeredAt":null},"sections":[{"sectionNumber":"Obtaining Copies of Accounting Standards","sectionType":"part","heading":"Obtaining Copies of Accounting Standards","content":"## Obtaining Copies of Accounting Standards\n\nCompiled versions of Standards, original Standards and amending Standards (see Compilation Details) are available on the AASB website: www.aasb.gov.au.\n\nPrinted copies of original Standards and amending Standards are available for purchase by contacting:\n\n| The Customer Service OfficerAustralian Accounting Standards BoardLevel 7600 Bourke StreetMelbourne VictoriaAUSTRALIA | Postal address:PO Box 204 Collins Street WestVictoria 8007AUSTRALIA |\n| -------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------- |\n\nPhone: (03) 9617 7637\n\nFax: (03) 9617 7608\n\nE-mail: publications@aasb.gov.au\n\nWebsite: www.aasb.gov.au","sortOrder":0},{"sectionNumber":"Other Enquiries","sectionType":"part","heading":"Other Enquiries","content":"## Other Enquiries\n\nPhone: (03) 9617 7600\n\nFax: (03) 9617 7608\n\nE-mail: standard@aasb.gov.au\n\nCOPYRIGHT\n\n© 2014 Commonwealth of Australia\n\nThis compiled AASB Standard contains IFRS Foundation copyright material. Reproduction within Australia in unaltered form (retaining this notice) is permitted for personal and non-commercial use subject to the inclusion of an acknowledgment of the source. Requests and enquiries concerning reproduction and rights for commercial purposes within Australia should be addressed to The Director of Finance and Administration, Australian Accounting Standards Board, PO Box 204, Collins Street West, Victoria 8007.\n\nAll existing rights in this material are reserved outside Australia.\n\nReproduction outside Australia in unaltered form (retaining this notice) is permitted for personal and non-commercial use only. Further information and requests for authorisation to reproduce for commercial purposes outside Australia should be addressed to the IFRS Foundation at www.ifrs.org.","sortOrder":1},{"sectionNumber":"CONTENTS","sectionType":"part","heading":"CONTENTS","content":"# CONTENTS\n\nCOMPILATION DETAILS\n\nComparison With IAS 18\n\nAccounting Standard\n\nAASB 118 Revenue\n\nParagraphs\n\nObjective\n\nApplication Aus1.1 – Aus1.7\n\nScope 1 – 6\n\nDefinitions 7 – 8\n\nMeasurement of Revenue 9 – 12\n\nIdentification of the Transaction 13\n\nSale of Goods 14 – 19\n\nRendering of Services 20 – 28\n\nInterest, Royalties and Dividends 29 – 34\n\nDisclosure 35 – 36\n\nEffective Date 38 – 43\n\nILLUSTRATIVE EXAMPLES Page 13\n\nDELETED IAS 18 TEXT Page 18\n\nAustralian Accounting Standard AASB 118 Revenue (as amended) is set out in paragraphs Aus1.1  43. All the paragraphs have equal authority. Terms defined in this Standard are in italics the first time they appear in the Standard. AASB 118 is to be read in the context of other Australian Accounting Standards, including AASB 1048 Interpretation of Standards, which identifies the Australian Accounting Interpretations. In the absence of explicit guidance, AASB 108 Accounting Policies, Changes in Accounting Estimates and Errors provides a basis for selecting and applying accounting policies.","sortOrder":2},{"sectionNumber":"compilation details","sectionType":"part","heading":"compilation details","content":"# compilation details\n\n## Accounting Standard AASB 118 Revenue as amended\n\nThis compiled Standard applies to annual reporting periods beginning on or after 1 January 2018. It takes into account amendments up to and including 4 June 2014 and was prepared on 10 September 2014 by the staff of the Australian Accounting Standards Board (AASB).\n\nThis compilation is not a separate Accounting Standard made by the AASB. Instead, it is a representation of AASB 118 (July 2004) as amended by other Accounting Standards, which are listed in the Table below.\n\n### Table of Standards\n\n| Standard          | Date made   | Application date(annual reporting periods … on or after …) | Application, saving or transitional provisions |\n| ----------------- | ----------- | ---------------------------------------------------------- | ---------------------------------------------- |\n| AASB 118          | 15 Jul 2004 | (beginning) 1 Jan 2005                                     |                                                |\n| AASB 2007-2       | 15 Feb 2007 | (ending) 28 Feb 2007                                       | see (a) below                                  |\n| AASB 2007-4       | 30 Apr 2007 | (beginning) 1 Jul 2007                                     | see (b) below                                  |\n| AASB 2007-8       | 24 Sep 2007 | (beginning) 1 Jan 2009                                     | see (c) below                                  |\n| AASB 2008-5       | 24 Jul 2008 | (beginning) 1 Jan 2009                                     | see (d) below                                  |\n| AASB 2008-7       | 25 Jul 2008 | (beginning) 1 Jan 2009                                     | see (e) below                                  |\n| Interpretation 15 | 27 Aug 2008 | (beginning) 1 Jan 2009                                     | see (e) below                                  |\n| AASB 2009-5       | 21 May 2009 | (beginning) 1 Jan 2010                                     | see (f) below                                  |\n| AASB 2009-11      | 7 Dec 2009  | (beginning) 1 Jan 2018                                     | see (g) below                                  |\n| AASB 2010-5       | 27 Oct 2010 | (beginning) 1 Jan 2011                                     | see (h) below                                  |\n| AASB 2010-7       | 6 Dec 2010  | (beginning) 1 Jan 2018                                     | see (i) below                                  |\n| AASB 2011-7       | 29 Aug 2011 | (beginning) 1 Jan 2013                                     | see (j) below                                  |\n| AASB 2011-8       | 2 Sep 2011  | (beginning) 1 Jan 2013                                     | see (k) below                                  |\n| AASB 2012-10      | 18 Dec 2012 | (beginning) 1 Jan 2013                                     | see (l) below                                  |\n| AASB 2013-9       | 20 Dec 2013 | Pt A (ending) 20 Dec 2013Pt B (beginning) 1 Jan 2014       | see (m) belowsee (n) below                     |\n| AASB 2014-1       | 4 Jun 2014  | Pt E (beginning) 1 Jan 2018                                | see (o) below                                  |\n\n(a) Entities may elect to apply the relevant amendments to annual reporting periods beginning on or after 1 January 2005 that end before 28 February 2007.\n\n(b) Entities may elect to apply this Standard to annual reporting periods beginning on or after 1 January 2005 but before 1 July 2007.\n\n(c) Entities may elect to apply this Standard to annual reporting periods beginning on or after 1 January 2005 but before 1 January 2009, provided that AASB 101 Presentation of Financial Statements (September 2007) is also applied to such periods.\n\n(d) Entities may elect to apply this Standard, or its amendments to individual Standards, to annual reporting periods beginning on or after 1 January 2005 but before 1 January 2009.\n\n(e) Entities may elect to apply this pronouncement to annual reporting periods beginning on or after 1 January 2005 but before 1 January 2009.\n\n(f) Entities may elect to apply this Standard, or its amendments to individual Standards, to annual reporting periods beginning on or after 1 January 2005 but before 1 January 2010.\n\n(g) AASB 2009-11 has been amended by AASB 2010-10 (made 31 December 2010) and AASB 2012-6 (made 10 September 2012). Part E of AASB 2014-1 (made 4 June 2014) updated the application date of the amendments in this Standard to 1 January 2018.\n\nEntities may elect to apply the amendments in this Standard to annual reporting periods ending on or after 31 December 2009 that begin before 1 January 2018, provided that AASB 9 (2009) Financial Instruments is also applied to such periods.\n\n(h) Entities may elect to apply this Standard to annual reporting periods beginning on or after 1 January 2005 but before 1 January 2011.\n\n(i) AASB 2010-7 has been amended by AASB 2010-10 (made 31 December 2010) and AASB 2012-6 (made 10 September 2012). Part E of AASB 2014-1 (made 4 June 2014) updated the application date of the amendments in this Standard to 1 January 2018.\n\nEntities may elect to apply the amendments in this Standard as set out in paragraph 6 of AASB 2010-7.\n\n(j) AASB 2011-7 has been amended by AASB 2012-6 (made 10 September 2012) and AASB 2012-10 (made 18 December 2012).\n\nFor-profit entities may elect to apply this Standard to annual reporting periods beginning on or after 1 January 2005 but before 1 January 2013. The Standard applies for not-for-profit entities to annual reporting periods beginning on or after 1 January 2014. Not-for-profit entities may elect to apply this Standard to annual reporting periods beginning on or after 1 January 2013 but before 1 January 2014. If an entity elects to apply this Standard to such annual reporting periods, it shall also apply AASB 10 Consolidated Financial Statements and associated Standards to such periods.\n\n(k) AASB 2011-8 has been amended by AASB 2011-10 (made 5 September 2011) and AASB 2012-6 (made 10 September 2012).\n\nEntities may elect to apply this Standard to annual reporting periods beginning on or after 1 January 2005 but before 1 January 2013, provided that AASB 13 Fair Value Measurement is also applied to such periods.\n\n(l) Entities may elect to apply this Standard to annual reporting periods beginning on or after 1 January 2005 but before 1 January 2013.\n\n(m) Entities may elect to apply this Standard to annual reporting periods beginning on or after 1 January 2005 that end before 20 December 2013, provided that AASB CF 2013-1 Amendments to the Australian Conceptual Framework and AASB 1048 Interpretation of Standards (December 2013) are also applied to the such periods.\n\n(n) Early application of Part B of this Standard is not permitted.\n\n(o) Entities may elect to apply Part E of this Standard to annual reporting periods ending on or after 31 December 2009 that begin before 1 January 2018, provided that AASB 9 Financial Instruments (2009) or AASB 9 Financial Instruments (2010) is also applied to such periods.\n\n### Table of Amendments to Standard\n\n| Paragraph affected     | How affected          | By … [paragraph]                                     |\n| ---------------------- | --------------------- | ---------------------------------------------------- |\n| Objective              | amended               | AASB 2013-9A [22]                                    |\n| Aus1.1                 | amended               | AASB 2007-8 [7, 8]                                   |\n| Aus1.4                 | amendeddeleted        | AASB 2007-8 [8]AASB 2013-9B [37, 38]                 |\n| 6                      | amendedamendedamended | AASB 2009-11 [25]AASB 2010-7 [7, 26]AASB 2011-7 [35] |\n| 7                      | amended               | AASB 2011-8 [13]                                     |\n| 9 (footnote 1)         | amended               | AASB 2007-2 [10]                                     |\n| 11                     | amendedamendedamended | AASB 2009-11 [25]AASB 2010-5 [29]AASB 2010-7 [7, 26] |\n| 20 (footnotes 2, 3)    | amendedamended        | AASB 2007-2 [10]AASB 2007-8 [6]                      |\n| 21                     | amended               | AASB 2007-4 [52]                                     |\n| 32                     | amended               | AASB 2008-7 [12]                                     |\n| 37 (preceding heading) | amended               | AASB 2008-7 [13]                                     |\n| 38                     | added                 | AASB 2008-7 [14]                                     |\n| 39                     | addeddeleted          | AASB 2009-11 [25]AASB 2010-7 [7, 26]                 |\n| 40                     | addeddeleted          | AASB 2010-7 [26]AASB 2014-1E [87[                    |\n| 41                     | added                 | AASB 2011-7 [36]                                     |\n| 42                     | added                 | AASB 2011-8 [51]                                     |\n| 43                     | added                 | AASB 2014-1E [87[                                    |\n\n### Table of Amendments to Illustrative Examples\n\n| Paragraph affected         | How affected   | By … [paragraph]                        |\n| -------------------------- | -------------- | --------------------------------------- |\n| Title, rubric              | amended        | AASB 2010-5 [30]                        |\n| 1 (preceding text)         | amended        | AASB 2012-10 [50]                       |\n| 5                          | amended        | AASB 2010-7 [27]                        |\n| 9                          | amendedamended | Interpretation 15 [23]AASB 2012-10 [51] |\n| 14                         | amendedamended | AASB 2008-5 [27]AASB 2010-7 [27]        |\n| 21 (and preceding heading) | added          | AASB 2009-5 [17]                        |","sortOrder":3},{"sectionNumber":"Accounting Standard AASB 118 Revenue as ","sectionType":"part","heading":"Accounting Standard AASB 118 Revenue as amended","content":"## Accounting Standard AASB 118 Revenue as amended\n\nThis compiled Standard applies to annual reporting periods beginning on or after 1 January 2018. It takes into account amendments up to and including 4 June 2014 and was prepared on 10 September 2014 by the staff of the Australian Accounting Standards Board (AASB).\n\nThis compilation is not a separate Accounting Standard made by the AASB. Instead, it is a representation of AASB 118 (July 2004) as amended by other Accounting Standards, which are listed in the Table below.","sortOrder":4},{"sectionNumber":"Table of Standards","sectionType":"division","heading":"Table of Standards","content":"### Table of Standards\n\n| Standard          | Date made   | Application date(annual reporting periods … on or after …) | Application, saving or transitional provisions |\n| ----------------- | ----------- | ---------------------------------------------------------- | ---------------------------------------------- |\n| AASB 118          | 15 Jul 2004 | (beginning) 1 Jan 2005                                     |                                                |\n| AASB 2007-2       | 15 Feb 2007 | (ending) 28 Feb 2007                                       | see (a) below                                  |\n| AASB 2007-4       | 30 Apr 2007 | (beginning) 1 Jul 2007                                     | see (b) below                                  |\n| AASB 2007-8       | 24 Sep 2007 | (beginning) 1 Jan 2009                                     | see (c) below                                  |\n| AASB 2008-5       | 24 Jul 2008 | (beginning) 1 Jan 2009                                     | see (d) below                                  |\n| AASB 2008-7       | 25 Jul 2008 | (beginning) 1 Jan 2009                                     | see (e) below                                  |\n| Interpretation 15 | 27 Aug 2008 | (beginning) 1 Jan 2009                                     | see (e) below                                  |\n| AASB 2009-5       | 21 May 2009 | (beginning) 1 Jan 2010                                     | see (f) below                                  |\n| AASB 2009-11      | 7 Dec 2009  | (beginning) 1 Jan 2018                                     | see (g) below                                  |\n| AASB 2010-5       | 27 Oct 2010 | (beginning) 1 Jan 2011                                     | see (h) below                                  |\n| AASB 2010-7       | 6 Dec 2010  | (beginning) 1 Jan 2018                                     | see (i) below                                  |\n| AASB 2011-7       | 29 Aug 2011 | (beginning) 1 Jan 2013                                     | see (j) below                                  |\n| AASB 2011-8       | 2 Sep 2011  | (beginning) 1 Jan 2013                                     | see (k) below                                  |\n| AASB 2012-10      | 18 Dec 2012 | (beginning) 1 Jan 2013                                     | see (l) below                                  |\n| AASB 2013-9       | 20 Dec 2013 | Pt A (ending) 20 Dec 2013Pt B (beginning) 1 Jan 2014       | see (m) belowsee (n) below                     |\n| AASB 2014-1       | 4 Jun 2014  | Pt E (beginning) 1 Jan 2018                                | see (o) below                                  |\n\n(a) Entities may elect to apply the relevant amendments to annual reporting periods beginning on or after 1 January 2005 that end before 28 February 2007.\n\n(b) Entities may elect to apply this Standard to annual reporting periods beginning on or after 1 January 2005 but before 1 July 2007.\n\n(c) Entities may elect to apply this Standard to annual reporting periods beginning on or after 1 January 2005 but before 1 January 2009, provided that AASB 101 Presentation of Financial Statements (September 2007) is also applied to such periods.\n\n(d) Entities may elect to apply this Standard, or its amendments to individual Standards, to annual reporting periods beginning on or after 1 January 2005 but before 1 January 2009.\n\n(e) Entities may elect to apply this pronouncement to annual reporting periods beginning on or after 1 January 2005 but before 1 January 2009.\n\n(f) Entities may elect to apply this Standard, or its amendments to individual Standards, to annual reporting periods beginning on or after 1 January 2005 but before 1 January 2010.\n\n(g) AASB 2009-11 has been amended by AASB 2010-10 (made 31 December 2010) and AASB 2012-6 (made 10 September 2012). Part E of AASB 2014-1 (made 4 June 2014) updated the application date of the amendments in this Standard to 1 January 2018.\n\nEntities may elect to apply the amendments in this Standard to annual reporting periods ending on or after 31 December 2009 that begin before 1 January 2018, provided that AASB 9 (2009) Financial Instruments is also applied to such periods.\n\n(h) Entities may elect to apply this Standard to annual reporting periods beginning on or after 1 January 2005 but before 1 January 2011.\n\n(i) AASB 2010-7 has been amended by AASB 2010-10 (made 31 December 2010) and AASB 2012-6 (made 10 September 2012). Part E of AASB 2014-1 (made 4 June 2014) updated the application date of the amendments in this Standard to 1 January 2018.\n\nEntities may elect to apply the amendments in this Standard as set out in paragraph 6 of AASB 2010-7.\n\n(j) AASB 2011-7 has been amended by AASB 2012-6 (made 10 September 2012) and AASB 2012-10 (made 18 December 2012).\n\nFor-profit entities may elect to apply this Standard to annual reporting periods beginning on or after 1 January 2005 but before 1 January 2013. The Standard applies for not-for-profit entities to annual reporting periods beginning on or after 1 January 2014. Not-for-profit entities may elect to apply this Standard to annual reporting periods beginning on or after 1 January 2013 but before 1 January 2014. If an entity elects to apply this Standard to such annual reporting periods, it shall also apply AASB 10 Consolidated Financial Statements and associated Standards to such periods.\n\n(k) AASB 2011-8 has been amended by AASB 2011-10 (made 5 September 2011) and AASB 2012-6 (made 10 September 2012).\n\nEntities may elect to apply this Standard to annual reporting periods beginning on or after 1 January 2005 but before 1 January 2013, provided that AASB 13 Fair Value Measurement is also applied to such periods.\n\n(l) Entities may elect to apply this Standard to annual reporting periods beginning on or after 1 January 2005 but before 1 January 2013.\n\n(m) Entities may elect to apply this Standard to annual reporting periods beginning on or after 1 January 2005 that end before 20 December 2013, provided that AASB CF 2013-1 Amendments to the Australian Conceptual Framework and AASB 1048 Interpretation of Standards (December 2013) are also applied to the such periods.\n\n(n) Early application of Part B of this Standard is not permitted.\n\n(o) Entities may elect to apply Part E of this Standard to annual reporting periods ending on or after 31 December 2009 that begin before 1 January 2018, provided that AASB 9 Financial Instruments (2009) or AASB 9 Financial Instruments (2010) is also applied to such periods.","sortOrder":5},{"sectionNumber":"Table of Amendments to Standard","sectionType":"division","heading":"Table of Amendments to Standard","content":"### Table of Amendments to Standard\n\n| Paragraph affected     | How affected          | By … [paragraph]                                     |\n| ---------------------- | --------------------- | ---------------------------------------------------- |\n| Objective              | amended               | AASB 2013-9A [22]                                    |\n| Aus1.1                 | amended               | AASB 2007-8 [7, 8]                                   |\n| Aus1.4                 | amendeddeleted        | AASB 2007-8 [8]AASB 2013-9B [37, 38]                 |\n| 6                      | amendedamendedamended | AASB 2009-11 [25]AASB 2010-7 [7, 26]AASB 2011-7 [35] |\n| 7                      | amended               | AASB 2011-8 [13]                                     |\n| 9 (footnote 1)         | amended               | AASB 2007-2 [10]                                     |\n| 11                     | amendedamendedamended | AASB 2009-11 [25]AASB 2010-5 [29]AASB 2010-7 [7, 26] |\n| 20 (footnotes 2, 3)    | amendedamended        | AASB 2007-2 [10]AASB 2007-8 [6]                      |\n| 21                     | amended               | AASB 2007-4 [52]                                     |\n| 32                     | amended               | AASB 2008-7 [12]                                     |\n| 37 (preceding heading) | amended               | AASB 2008-7 [13]                                     |\n| 38                     | added                 | AASB 2008-7 [14]                                     |\n| 39                     | addeddeleted          | AASB 2009-11 [25]AASB 2010-7 [7, 26]                 |\n| 40                     | addeddeleted          | AASB 2010-7 [26]AASB 2014-1E [87[                    |\n| 41                     | added                 | AASB 2011-7 [36]                                     |\n| 42                     | added                 | AASB 2011-8 [51]                                     |\n| 43                     | added                 | AASB 2014-1E [87[                                    |","sortOrder":6},{"sectionNumber":"Table of Amendments to Illustrative Exam","sectionType":"division","heading":"Table of Amendments to Illustrative Examples","content":"### Table of Amendments to Illustrative Examples\n\n| Paragraph affected         | How affected   | By … [paragraph]                        |\n| -------------------------- | -------------- | --------------------------------------- |\n| Title, rubric              | amended        | AASB 2010-5 [30]                        |\n| 1 (preceding text)         | amended        | AASB 2012-10 [50]                       |\n| 5                          | amended        | AASB 2010-7 [27]                        |\n| 9                          | amendedamended | Interpretation 15 [23]AASB 2012-10 [51] |\n| 14                         | amendedamended | AASB 2008-5 [27]AASB 2010-7 [27]        |\n| 21 (and preceding heading) | added          | AASB 2009-5 [17]                        |","sortOrder":7},{"sectionNumber":"Comparison with IAS 18","sectionType":"part","heading":"Comparison with IAS 18","content":"# Comparison with IAS 18\n\n## AASB 118 and IAS 18\n\nAASB 118 Revenue as amended incorporates IAS 18 Revenue as issued and amended by the International Accounting Standards Board (IASB). Paragraphs that have been added to this Standard (and do not appear in the text of IAS 18) are identified with the prefix “Aus”, followed by the number of the relevant IASB paragraph and decimal numbering.\n\n### Compliance with IAS 18\n\nEntities that comply with AASB 118 as amended will simultaneously be in compliance with IAS 18 as amended.","sortOrder":8},{"sectionNumber":"AASB 118 and IAS 18","sectionType":"part","heading":"AASB 118 and IAS 18","content":"## AASB 118 and IAS 18\n\nAASB 118 Revenue as amended incorporates IAS 18 Revenue as issued and amended by the International Accounting Standards Board (IASB). Paragraphs that have been added to this Standard (and do not appear in the text of IAS 18) are identified with the prefix “Aus”, followed by the number of the relevant IASB paragraph and decimal numbering.","sortOrder":9},{"sectionNumber":"Compliance with IAS 18","sectionType":"division","heading":"Compliance with IAS 18","content":"### Compliance with IAS 18\n\nEntities that comply with AASB 118 as amended will simultaneously be in compliance with IAS 18 as amended.","sortOrder":10},{"sectionNumber":"aCCOUNTING STANDARD AASB 118","sectionType":"part","heading":"aCCOUNTING STANDARD AASB 118","content":"# aCCOUNTING STANDARD AASB 118\n\nRevenue","sortOrder":11},{"sectionNumber":"Objective","sectionType":"part","heading":"Objective","content":"## Objective\n\nIncome is defined in the Framework for the Preparation and Presentation of Financial Statements (as identified in AASB 1048 Interpretation of Standards)[\\[1\\]](#_ftn1) as increases in economic benefits during the reporting period in the form of inflows or enhancements of assets or decreases of liabilities that result in increases in equity, other than those relating to contributions from equity participants. Income encompasses both revenue and gains. Revenue is income that arises in the course of ordinary activities of an entity and is referred to by a variety of different names including sales, fees, interest, dividends and royalties. The objective of this Standard is to prescribe the accounting treatment of revenue arising from certain types of transactions and events.\n\nThe primary issue in accounting for revenue is determining when to recognise revenue. Revenue is recognised when it is probable that future economic benefits will flow to the entity and these benefits can be measured reliably. This Standard identifies the circumstances in which these criteria will be met and, therefore, revenue will be recognised. It also provides practical guidance on the application of these criteria.","sortOrder":12},{"sectionNumber":"Application","sectionType":"part","heading":"Application","content":"## Application\n\nAus1.1 This Standard applies to:\n\n(a) each entity that is required to prepare financial reports in accordance with Part 2M.3 of the Corporations Act and that is a reporting entity;\n\n(b) general purpose financial statements of each other reporting entity; and\n\n(c) financial statements that are, or are held out to be, general purpose financial statements.\n\nAus1.2 This Standard applies to annual reporting periods beginning on or after 1 January 2005.  \n\\[Note: For application dates of paragraphs changed or added by an amending Standard, see Compilation Details.\\]\n\nAus1.3 This Standard shall not be applied to annual reporting periods beginning before 1 January 2005.\n\nAus1.4 \\[Deleted by the AASB\\]\n\nAus1.5 When applicable, this Standard supersedes:\n\n(a) AASB 1004 Revenue as notified in the Commonwealth of Australia Gazette No S 283, 17 June 1998; and\n\n(b) AAS 15 Revenue as issued in June 1998.\n\nAus1.6 Both AASB 1004 and AAS 15 remain applicable until superseded by this Standard.\n\nAus1.7 Notice of this Standard was published in the Commonwealth of Australia Gazette No S 294, 22 July 2004.","sortOrder":13},{"sectionNumber":"Scope","sectionType":"part","heading":"Scope","content":"## Scope\n\n1 This Standard shall be applied in accounting for revenue arising from the following transactions and events:\n\n(a) the sale of goods;\n\n(b) the rendering of services; and\n\n(c) the use by others of entity assets yielding interest, royalties and dividends.\n\n2 \\[Deleted by the AASB\\]\n\n3 Goods includes goods produced by the entity for the purpose of sale and goods purchased for resale, such as merchandise purchased by a retailer or land and other property held for resale.\n\n4 The rendering of services typically involves the performance by the entity of a contractually agreed task over an agreed period of time. The services may be rendered within a single period or over more than one period. Some contracts for the rendering of services are directly related to construction contracts, for example, those for the services of project managers and architects. Revenue arising from these contracts is not dealt with in this Standard but is dealt with in accordance with the requirements for construction contracts as specified in AASB 111 Construction Contracts.\n\n5 The use by others of entity assets gives rise to revenue in the form of:\n\n(a) interest – charges for the use of cash or cash equivalents or amounts due to the entity;\n\n(b) royalties – charges for the use of long-term assets of the entity, for example, patents, trademarks, copyrights and computer software; and\n\n(c) dividends – distributions of profits to holders of equity investments in proportion to their holdings of a particular class of capital.\n\n6 This Standard does not deal with revenue arising from:\n\n(a) lease agreements (see AASB 117 Leases);\n\n(b) dividends arising from investments which are accounted for under the equity method (see AASB 128 Investments in Associates and Joint Ventures);\n\n(c) insurance contracts within the scope of AASB 4 Insurance Contracts;\n\n(d) changes in the fair value of financial assets and financial liabilities or their disposal (see AASB 9 Financial Instruments);\n\n(e) changes in the value of other current assets;\n\n(f) initial recognition and from changes in the fair value of biological assets related to agricultural activity (see AASB 141 Agriculture);\n\n(g) initial recognition of agricultural produce (see AASB 141); and\n\n(h) the extraction of mineral ores.","sortOrder":14},{"sectionNumber":"Definitions","sectionType":"part","heading":"Definitions","content":"## Definitions\n\n7 The following terms are used in this Standard with the meanings specified.\n\nFair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. (See AASB 13 Fair Value Measurement.)\n\nRevenue is the gross inflow of economic benefits during the period arising in the course of the ordinary activities of an entity when those inflows result in increases in equity, other than increases relating to contributions from equity participants.\n\n8 Revenue includes only the gross inflows of economic benefits received and receivable by the entity on its own account. Amounts collected on behalf of third parties such as sales taxes, goods and services taxes and value added taxes are not economic benefits which flow to the entity and do not result in increases in equity. Therefore, they are excluded from revenue. Similarly, in an agency relationship, the gross inflows of economic benefits include amounts collected on behalf of the principal and which do not result in increases in equity for the entity. The amounts collected on behalf of the principal are not revenue. Instead, revenue is the amount of commission.","sortOrder":15},{"sectionNumber":"Measurement of Revenue","sectionType":"part","heading":"Measurement of Revenue","content":"## Measurement of Revenue\n\n9 Revenue shall be measured at the fair value of the consideration received or receivable.[\\[1\\]](#_ftn2)\n\n10 The amount of revenue arising on a transaction is usually determined by agreement between the entity and the buyer or user of the asset. It is measured at the fair value of the consideration received or receivable taking into account the amount of any trade discounts and volume rebates allowed by the entity.\n\n11 In most cases, the consideration is in the form of cash or cash equivalents and the amount of revenue is the amount of cash or cash equivalents received or receivable. However, when the inflow of cash or cash equivalents is deferred, the fair value of the consideration may be less than the nominal amount of cash received or receivable. For example, an entity may provide interest\\-free credit to the buyer or accept a note receivable bearing a below-market interest rate from the buyer as consideration for the sale of goods. When the arrangement effectively constitutes a financing transaction, the fair value of the consideration is determined by discounting all future receipts using an imputed rate of interest. The imputed rate of interest is the more clearly determinable of either:\n\n(a) the prevailing rate for a similar instrument of an issuer with a similar credit rating; or\n\n(b) a rate of interest that discounts the nominal amount of the instrument to the current cash sales price of the goods or services.\n\nThe difference between the fair value and the nominal amount of the consideration is recognised as interest revenue in accordance with paragraphs 29 and 30 and in accordance with AASB 9.\n\n12 When goods or services are exchanged or swapped for goods or services which are of a similar nature and value, the exchange is not regarded as a transaction which generates revenue. This is often the case with commodities like oil or milk where suppliers exchange or swap inventories in various locations to fulfil demand on a timely basis in a particular location. When goods are sold or services are rendered in exchange for dissimilar goods or services, the exchange is regarded as a transaction which generates revenue. The revenue is measured at the fair value of the goods or services received, adjusted by the amount of any cash or cash equivalents transferred. When the fair value of the goods or services received cannot be measured reliably, the revenue is measured at the fair value of the goods or services given up, adjusted by the amount of any cash or cash equivalents transferred.","sortOrder":16},{"sectionNumber":"Identification of the Transaction","sectionType":"part","heading":"Identification of the Transaction","content":"## Identification of the Transaction\n\n13 The recognition criteria in this Standard are usually applied separately to each transaction. However, in certain circumstances, it is necessary to apply the recognition criteria to the separately identifiable components of a single transaction in order to reflect the substance of the transaction. For example, when the selling price of a product includes an identifiable amount for subsequent servicing, that amount is deferred and recognised as revenue over the period during which the service is performed. Conversely, the recognition criteria are applied to two or more transactions together when they are linked in such a way that the commercial effect cannot be understood without reference to the series of transactions as a whole. For example, an entity may sell goods and, at the same time, enter into a separate agreement to repurchase the goods at a later date, thus negating the substantive effect of the transaction; in such a case, the two transactions are dealt with together.","sortOrder":17},{"sectionNumber":"Sale of Goods","sectionType":"part","heading":"Sale of Goods","content":"## Sale of Goods\n\n14 Revenue from the sale of goods shall be recognised when all the following conditions have been satisfied:\n\n(a) the entity has transferred to the buyer the significant risks and rewards of ownership of the goods;\n\n(b) the entity retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold;\n\n(c) the amount of revenue can be measured reliably;\n\n(d) it is probable that the economic benefits associated with the transaction will flow to the entity; and\n\n(e) the costs incurred or to be incurred in respect of the transaction can be measured reliably.\n\n15 The assessment of when an entity has transferred the significant risks and rewards of ownership to the buyer requires an examination of the circumstances of the transaction. In most cases, the transfer of the risks and rewards of ownership coincides with the transfer of the legal title or the passing of possession to the buyer. This is the case for most retail sales. In other cases, the transfer of risks and rewards of ownership occurs at a different time from the transfer of legal title or the passing of possession.\n\n16 If the entity retains significant risks of ownership, the transaction is not a sale and revenue is not recognised. An entity may retain a significant risk of ownership in a number of ways. Examples of situations in which the entity may retain the significant risks and rewards of ownership are:\n\n(a) when the entity retains an obligation for unsatisfactory performance not covered by normal warranty provisions;\n\n(b) when the receipt of the revenue from a particular sale is contingent on the derivation of revenue by the buyer from its sale of the goods;\n\n(c) when the goods are shipped subject to installation and the installation is a significant part of the contract which has not yet been completed by the entity; and\n\n(d) when the buyer has the right to rescind the purchase for a reason specified in the sales contract and the entity is uncertain about the probability of return.\n\n17 If an entity retains only an insignificant risk of ownership, the transaction is a sale and revenue is recognised. For example, a seller may retain the legal title to the goods solely to protect the collectability of the amount due. In such a case, if the entity has transferred the significant risks and rewards of ownership, the transaction is a sale and revenue is recognised. Another example of an entity retaining only an insignificant risk of ownership may be a retail sale when a refund is offered if the customer is not satisfied. Revenue in such cases is recognised at the time of sale provided the seller can reliably estimate future returns and recognises a liability for returns based on previous experience and other relevant factors.\n\n18 Revenue is recognised only when it is probable that the economic benefits associated with the transaction will flow to the entity. In some cases, this may not be probable until the consideration is received or until an uncertainty is removed. For example, it may be uncertain that a foreign governmental authority will grant permission to remit the consideration from a sale in a foreign country. When the permission is granted, the uncertainty is removed and revenue is recognised. However, when an uncertainty arises about the collectability of an amount already included in revenue, the uncollectable amount or the amount in respect of which recovery has ceased to be probable is recognised as an expense, rather than as an adjustment of the amount of revenue originally recognised.\n\n19 Revenue and expenses that relate to the same transaction or other event are recognised simultaneously; this process is commonly referred to as the matching of revenues and expenses. Expenses, including warranties and other costs to be incurred after the shipment of the goods can normally be measured reliably when the other conditions for the recognition of revenue have been satisfied. However, revenue cannot be recognised when the expenses cannot be measured reliably; in such circumstances, any consideration already received for the sale of the goods is recognised as a liability.","sortOrder":18},{"sectionNumber":"Rendering of Services","sectionType":"part","heading":"Rendering of Services","content":"## Rendering of Services\n\n20 When the outcome of a transaction involving the rendering of services can be estimated reliably, revenue associated with the transaction shall be recognised by reference to the stage of completion of the transaction at the end of the reporting period. The outcome of a transaction can be estimated reliably when all the following conditions are satisfied:\n\n(a) the amount of revenue can be measured reliably;\n\n(b) it is probable that the economic benefits associated with the transaction will flow to the entity;\n\n(c) the stage of completion of the transaction at the end of the reporting period can be measured reliably; and\n\n(d) the costs incurred for the transaction and the costs to complete the transaction can be measured reliably.[\\[2\\]](#_ftn3), [\\[3\\]](#_ftn4)\n\n21 The recognition of revenue by reference to the stage of completion of a transaction is often referred to as the percentage of completion method. Under this method, revenue is recognised in the reporting periods in which the services are rendered. The recognition of revenue on this basis provides useful information on the extent of service activity and performance during a period. AASB 111 also requires the recognition of revenue on this basis. The requirements of that Standard are generally applicable to the recognition of revenue and the associated expenses for a transaction involving the rendering of services.\n\n22 Revenue is recognised only when it is probable that the economic benefits associated with the transaction will flow to the entity. However, when an uncertainty arises about the collectability of an amount already included in revenue, the uncollectable amount, or the amount in respect of which recovery has ceased to be probable, is recognised as an expense, rather than as an adjustment of the amount of revenue originally recognised.\n\n23 An entity is generally able to make reliable estimates after it has agreed to the following with the other parties to the transaction:\n\n(a) each party’s enforceable rights regarding the service to be provided and received by the parties;\n\n(b) the consideration to be exchanged; and\n\n(c) the manner and terms of settlement.\n\nIt is also usually necessary for the entity to have an effective internal financial budgeting and reporting system. The entity reviews and, when necessary, revises the estimates of revenue as the service is performed. The need for such revisions does not necessarily indicate that the outcome of the transaction cannot be estimated reliably.\n\n24 The stage of completion of a transaction may be determined by a variety of methods. An entity uses the method that measures reliably the services performed. Depending on the nature of the transaction, the methods may include:\n\n(a) surveys of work performed;\n\n(b) services performed to date as a percentage of total services to be performed; or\n\n(c) the proportion that costs incurred to date bear to the estimated total costs of the transaction. Only costs that reflect services performed to date are included in costs incurred to date. Only costs that reflect services performed or to be performed are included in the estimated total costs of the transaction.\n\nProgress payments and advances received from customers often do not reflect the services performed.\n\n25 For practical purposes, when services are performed by an indeterminate number of acts over a specified period of time, revenue is recognised on a straight-line basis over the specified period unless there is evidence that some other method better represents the stage of completion. When a specific act is much more significant than any other acts, the recognition of revenue is postponed until the significant act is executed.\n\n26 When the outcome of the transaction involving the rendering of services cannot be estimated reliably, revenue shall be recognised only to the extent of the expenses recognised that are recoverable.\n\n27 During the early stages of a transaction, it is often the case that the outcome of the transaction cannot be estimated reliably. Nevertheless, it may be probable that the entity will recover the transaction costs incurred. Therefore, revenue is recognised only to the extent of costs incurred that are expected to be recoverable. As the outcome of the transaction cannot be estimated reliably, no profit is recognised.\n\n28 When the outcome of a transaction cannot be estimated reliably and it is not probable that the costs incurred will be recovered, revenue is not recognised and the costs incurred are recognised as an expense. When the uncertainties that prevented the outcome of the contract being estimated reliably no longer exist, revenue is recognised in accordance with paragraph 20 rather than in accordance with paragraph 26.","sortOrder":19},{"sectionNumber":"Interest, Royalties and Dividends","sectionType":"part","heading":"Interest, Royalties and Dividends","content":"## Interest, Royalties and Dividends\n\n29 Revenue arising from the use by others of entity assets yielding interest, royalties and dividends shall be recognised on the bases set out in paragraph 30 when:\n\n(a) it is probable that the economic benefits associated with the transaction will flow to the entity; and\n\n(b) the amount of the revenue can be measured reliably.\n\n30 Revenue shall be recognised on the following bases:\n\n(a) interest shall be recognised using the effective interest method as set out in AASB 139, paragraphs 9 and AG5AG8;\n\n(b) royalties shall be recognised on an accrual basis in accordance with the substance of the relevant agreement; and\n\n(c) dividends shall be recognised when the shareholder’s right to receive payment is established.\n\n31 \\[Deleted by the IASB\\]\n\n32 When unpaid interest has accrued before the acquisition of an interest-bearing investment, the subsequent receipt of interest is allocated between pre-acquisition and post-acquisition periods; only the post-acquisition portion is recognised as revenue.\n\n33 Royalties accrue in accordance with the terms of the relevant agreement and are usually recognised on that basis unless, having regard to the substance of the agreement, it is more appropriate to recognise revenue on some other systematic and rational basis.\n\n34 Revenue is recognised only when it is probable that the economic benefits associated with the transaction will flow to the entity. However, when an uncertainty arises about the collectability of an amount already included in revenue, the uncollectable amount, or the amount in respect of which recovery has ceased to be probable, is recognised as an expense, rather than as an adjustment of the amount of revenue originally recognised.","sortOrder":20},{"sectionNumber":"Disclosure","sectionType":"part","heading":"Disclosure","content":"## Disclosure\n\n35 An entity shall disclose:\n\n(a) the accounting policies adopted for the recognition of revenue including the methods adopted to determine the stage of completion of transactions involving the rendering of services;\n\n(b) the amount of each significant category of revenue recognised during the period including revenue arising from:\n\n(i) the sale of goods;\n\n(ii) the rendering of services;\n\n(iii) interest;\n\n(iv) royalties;\n\n(v) dividends; and\n\n(c) the amount of revenue arising from exchanges of goods or services included in each significant category of revenue.\n\n36 An entity discloses any contingent liabilities and contingent assets in accordance with AASB 137 Provisions, Contingent Liabilities and Contingent Assets. Contingent liabilities and contingent assets may arise from items such as warranty costs, claims, penalties or possible losses.","sortOrder":21},{"sectionNumber":"Effective Date","sectionType":"part","heading":"Effective Date","content":"## Effective Date\n\n37 \\[Deleted by the AASB\\]\n\n38 AASB 2008-7 Amendments to Australian Accounting Standards – Cost of an Investment in a Subsidiary, Jointly Controlled Entity or Associate, issued in July 2008, amended paragraph 32. An entity shall apply that amendment prospectively for annual reporting periods beginning on or after 1 January 2009. Earlier application is permitted. If an entity applies the related amendments in paragraphs 4 and 37A of AASB 127 (July 2004, as amended) or paragraphs 4 and 38A of AASB 127 (March 2008, as amended) for an earlier period, it shall apply the amendment in paragraph 32 at the same time.\n\n39 \\[Deleted by the IASB\\]\n\n40 \\[Deleted by the IASB\\]\n\n41 AASB 2011-7 Amendments to Australian Accounting Standards arising from the Consolidation and Joint Arrangements Standards, issued in August 2011, amended paragraph 6(b). An entity shall apply that amendment when it applies AASB 11 Joint Arrangements.\n\n42 AASB 2011-8 Amendments to Australian Accounting Standards arising from AASB 13, issued in September 2011, amended the definition of fair value in paragraph 7. An entity shall apply that amendment when it applies AASB 13.\n\n43 AASB 2010-7 Amendments to Australian Accounting Standards arising from AASB 9 (December 2010) (as amended) amended paragraphs 6(d) and 11 and deleted paragraph 39. Paragraph 40, added by AASB 2010-7, was deleted by AASB 2014-1 Amendments to Australian Accounting Standards. An entity shall apply those amendments when it applies AASB 9 as amended in June 2014.","sortOrder":22},{"sectionNumber":"Illustrative Examples","sectionType":"part","heading":"Illustrative Examples","content":"# Illustrative Examples\n\nThese illustrative examples accompany, but are not part of, AASB 118. The examples focus on particular aspects of a transaction and are not a comprehensive discussion of all the relevant factors that might influence the recognition of revenue. The examples generally assume that the amount of revenue can be measured reliably, it is probable that the economic benefits will flow to the entity and the costs incurred or to be incurred can be measured reliably.","sortOrder":23},{"sectionNumber":"Recognition and Measurement","sectionType":"part","heading":"Recognition and Measurement","content":"## Recognition and Measurement\n\n21 Determining whether an entity is acting as a principal or as an agent (2009 amendment)\n\nParagraph 8 states that ‘in an agency relationship, the gross inflows of economic benefits include amounts collected on behalf of the principal and which do not result in increases in equity for the entity. The amounts collected on behalf of the principal are not revenue. Instead, revenue is the amount of commission.’ Determining whether an entity is acting as a principal or as an agent requires judgement and consideration of all relevant facts and circumstances.\n\nAn entity is acting as a principal when it has exposure to the significant risks and rewards associated with the sale of goods or the rendering of services. Features that indicate that an entity is acting as a principal include:\n\n(a) the entity has the primary responsibility for providing the goods or services to the customer or for fulfilling the order, for example by being responsible for the acceptability of the products or services ordered or purchased by the customer;\n\n(b) the entity has inventory risk before or after the customer order, during shipping or on return;\n\n(c) the entity has latitude in establishing prices, either directly or indirectly, for example by providing additional goods or services; and\n\n(d) the entity bears the customer’s credit risk for the amount receivable from the customer.\n\nAn entity is acting as an agent when it does not have exposure to the significant risks and rewards associated with the sale of goods or the rendering of services. One feature indicating that an entity is acting as an agent is that the amount the entity earns is predetermined, being either a fixed fee per transaction or a stated percentage of the amount billed to the customer.","sortOrder":27},{"sectionNumber":"DELETED ias 18 TEXT","sectionType":"part","heading":"DELETED ias 18 TEXT","content":"# DELETED ias 18 TEXT\n\nDeleted IAS 18 text is not part of AASB 118.\n\nParagraph 2\n\nThis Standard supersedes IAS 18 Revenue Recognition approved in 1982.\n\nParagraph 37\n\nThis Standard becomes operative for financial statements covering periods beginning on or after 1 January 1995.","sortOrder":28}],"analysis":{"kimi_summary":{"_metrics":{"model":"kimi-k2.5","source":"moonshot-realtime","completionTokens":2806},"content_quality":"ok","complexity_score":6,"scope_assessment":{"changed":true,"description":"The standard's scope evolved significantly through amendments between 2004 and 2014. While maintaining its core focus on revenue recognition, exclusions were updated to refer to newer standards (e.g., financial instruments moved to AASB 9, agricultural produce to AASB 141). Application dates were deferred multiple times (ultimately to 1 January 2018) to align with the transition to the replacement standard AASB 15, and carve-outs were added for not-for-profit entities."},"complexity_factors":["Multiple distinct recognition criteria sets for different transaction types (5 conditions for goods, 4 for services, separate rules for interest/royalties/dividends)","15+ cross-references to other Australian Accounting Standards including AASB 9 (Financial Instruments), AASB 13 (Fair Value Measurement), AASB 111 (Construction Contracts), and AASB 117 (Leases)","Extensive amendment history incorporating changes from 15+ subsequent standards (AASB 2007-2 through AASB 2014-1) with complex transitional provisions","21 detailed illustrative examples covering nuanced commercial scenarios (bill and hold, consignment, lay-away sales, franchise fees, financial service fees)","Technical defined terms including 'fair value' and 'revenue' that differ from ordinary usage, plus concepts like 'stage of completion' and 'agency relationships' requiring professional judgment","Requirements to estimate stage of completion for services and to calculate present value for deferred payment arrangements"],"plain_english_summary":"This Standard tells Australian reporting entities when they can recognise money as revenue in financial statements, preventing premature income recognition and ensuring comparable, reliable profit reporting.\n\nRevenue is recognised only when economic benefits are probable and amounts are reliably measurable. It sets measurement rules (fair value and present value for deferred payments) and gives guidance for common transactions (sales, services, interest/royalties) and complex arrangements, affecting how entities present their results."},"flash_summary":{"complexity_score":7,"scope_assessment":{"changed":true,"description":"AASB 118 incorporates IAS 18 but adds Australian‑specific application and guidance (Aus paragraphs) and cross‑references to the Corporations Act (Aus1.1–Aus1.3) and other AASBs. The compilation and subsequent amendments adjust application dates, add/delete paragraphs and carve out or reassign revenue types to other standards (see para 6 and Compilation Details), so the effective scope and application mechanics differ from the original IAS 18 wording (see Comparison with IAS 18 and paras 38–43)."},"complexity_factors":["Judgement-heavy recognition tests (probable flow of benefits; reliable measurement; transfer of significant risks and rewards) — paras 9–12, 14–19, 20–24","Multiple revenue types with different measurement/recognition bases (goods, services, interest/royalties/dividends) — paras 1, 14–28, 29–34","Principal vs agent assessment requiring facts-and-circumstances analysis (affects whether gross or net amounts recognised) — para 21","Measurement complications where consideration is non‑cash or deferred (fair value, imputed interest, effective interest method) — paras 9, 11, 30(a)","Cross‑references and mandatory interaction with many other AASBs (AASB 9, AASB 11, AASB 13, AASB 111, AASB 117, AASB 139 etc.) creating implementation dependency — Aus1.1, para 6, paras 30(a), 38–43","Numerous amendments, transitional options and election choices across entities and periods (Compilation Details, Table of Standards) increasing application complexity","Disclosure and matching obligations that require systems to capture category-level revenue and contingent items — paras 19, 35–36","Industry and transaction exceptions and illustrative examples that require entity‑specific application (construction contracts excluded; real‑estate guidance superseded) — para 4; Illustrative Examples"],"plain_english_summary":"Mechanically, AASB 118 sets the rules for when and how entities recognise revenue from sales of goods, services and the use of assets (interest, royalties, dividends): revenue is measured at the fair value of consideration and recognised only when it is probable and can be measured reliably (paras 9–12, 14–20, 29–30). It applies to entities required to prepare financial reports under the Corporations Act and other reporting entities (Aus1.1–Aus1.3). Reporting entities must exercise judgment on timing and measurement, bearing the compliance costs and disclosure obligations (paras 35–36)."}},"importantCases":[],"_links":{"self":"/api/acts/aasb-118-revenue-july-2004","history":"/api/acts/aasb-118-revenue-july-2004/history","analysis":"/api/acts/aasb-118-revenue-july-2004/analysis","conflicts":"/api/acts/aasb-118-revenue-july-2004/conflicts","importantCases":"/api/acts/aasb-118-revenue-july-2004/important-cases","documents":"/api/acts/aasb-118-revenue-july-2004/documents"}}