Revenue Recognition -

CFA Level I
#1

Can someone summarize the difference? Is the below Correct

% Sale complete (allowed under GAAP and IFRS)

  • cost/rev reliably estimated

Completed Contract Methos

  • cost/rev not reliably estimated
  • GAAP - cost/rev recognized when contract is completed
  • IFRS - cost are recognized when incurred/ revenue is recognized to the extent of cost; profit -completion of project

Installment Sales

  • rev not reliably estimated - profit when cash is collected
  • GAAP and IFRS allow (?)

Cost Recovery Metho

  • rev highly uncertain - profit recognized when cash > cost
  • GAAP and IFRS allow (?)