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4 - AAU - Accounting and Financial Auditing

AAU 144 - Revenue Recognition and Controls

Code Start Date Duration Venue
AAU 144 05 August 2024 5 Days Istanbul Registration Form Link
AAU 144 09 September 2024 5 Days Istanbul Registration Form Link
AAU 144 14 October 2024 5 Days Istanbul Registration Form Link
AAU 144 18 November 2024 5 Days Istanbul Registration Form Link
AAU 144 23 December 2024 5 Days Istanbul Registration Form Link
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Course Description

The recognition of revenue is among the most misunderstood areas of accounting, leading to ongoing arguments between management and auditors about how to account for various sales transactions. 

Revenue Recognition brings clarity to the topic by focusing on, Revenue from Contracts with Customers, which describes the five-step process for recognizing many types of revenue.

The discussion includes the establishment of a contract, the determination of performance obligations, and how to set and allocate prices. 

Course Objectives

  • Identify the evaluation criteria for a contract, the components of the transaction price, and when a contract modification triggers treatment as a new contract.
  • Recognize the accounting treatment pertaining to customer acceptance clauses, rights to acquire additional goods, donations, asset repurchases, and breakage.
  • Recognize the situations under which contract liabilities occur, and when disaggregation is used.
  • Note the methods used to control which third parties are recognized as customers, and to control the use of justification documents for standalone pricing. 

Who Should Attend?

  • Financial managers
  • Financial controllers
  • Finance department heads, chief financial officers
  • Accounting managers, senior finance officers, accountants
  • Finance staff and analysts 

Course Details/Schedule

Day 1

  • Introduction.
  • Different types of revenue fraud arrangements.
  • The steps used in the revenue recognition process.
  • Recognize the various accounts that comprise an organization’s revenue.
  • Recognize the different types of strategic pricing options and their characteristics.

Day 2

  • IFRS Framework in Revenue.
  • Methods for Recognizing Revenue.
  • Completed contract method
  • Percentage of Completion Method.
  • Cost Recoverability.
  • Installment method.
  • Sales-Basis method.
  • Completion of Earnings

Day 3

  • Accounting rules that apply to noncash assets, nonrefundable fees, and customer acceptance.
  • Note the advantages and disadvantages of contribution margin pricing.
  • Cite the different types of incremental costs associated with revenue management.
  • Recognize the situations in which coupons and other promotions are most effective.

Day 4

  • Note the circumstances under which pricing adjustments can increase revenues.
  • Note the situations in which bundling, and unbundling can be favorable revenue management tools.
  • Recognize the purposes to which markdown management software can be put.
  • Note the different types of revenue management activities used by airlines, transportation, and utilities.
  • Understand how price positioning can skew the purchasing decisions of customers.
  • Recognize reference prices and their impact on the shopping decisions of customers.
  • Note how profits can be increased by using volume purchase discounts.

Day 5

  • Recognize the tools used to restrict the volume of sales at certain price points.
  • Cite the types of revenue boosts that are linked to high levels of customer satisfaction.
  • Cite the methods used by an auditor to audit revenue.
  • Identify the circumstances under which a contract does and does not exist.
  • Describe how and when the expected value method is used.