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How to Recognize Revenue in Project Accounts?

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Question added by Abdul Kareem Sheik Barith , Accountant , Wall Technology LLC
Date Posted: 2013/10/22
Nitin Gupta, ACA
by Nitin Gupta, ACA , FP&A , Rockwell Automation

It depends upon the Revenue recognistion model you follow for perticular business unit.

 

It can be Completed contract method or Percentage of completion. 

 

Please specify and elaborate your problem and I will explain you further.

Muhammad Nisar Khan
by Muhammad Nisar Khan , Accountant , Haddan Project Management Est.

when it is earned by providing services or goods..

Wakeel Ahmed
by Wakeel Ahmed , Finance Manager , Lloyd & Co. (Emirates) Insurance Brokers LLC

in projects,

1- Revenue and cost should be reocrded on the basis of stage of project completion method 

2- in the condition of loss revenue should be recognized on the basis of completion method and entire loss should be booked imidiately in income ststement 

 

I hope this may be helpful 

Regards,

wakel Ahmed

Muhammad Moosa
by Muhammad Moosa , Manager Finance , Sultan Mahmood & Company (Engineers & Contractors)

Percentage of completetion method should be used to recognize revenue in project accounts.

 

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