In work performed over time, such as construction and software projects, differences between billing and revenue are tracked in these items. When the right to consideration becomes unconditional, it becomes a trade receivable.
Source: TFRS 15
Related terms
Revenue from contracts with customers (TFRS 15)The standard requiring revenue to be recognised to depict the transfer of goods or services to customers, at the amount the entity expects to be entitled to.Performance obligationA promise in a contract with a customer to transfer a distinct good or service.Deferred incomeIncome collected or invoiced in advance that will be earned in future periods, such as rent or subscription fees received in advance.Accounting estimatesThe determination by management judgement of amounts that cannot be measured precisely, such as provisions, useful lives, expected credit losses and fair values.Accounting policiesThe specific principles, bases, conventions, rules and practices an entity applies in preparing its financial statements.Accrual basis of accountingThe principle of recording transactions as income, expenses, assets and liabilities in the period in which they occur, rather than when cash is received or paid.
Last updated: October 31, 2026 · This definition is for general information only.