IFRS 15 · Case studies (Step 3 of 5)
Practical case
Corlinde Systems SA, a fictitious company that designs, manufactures and installs automated sorting lines for recycling centres (340 employees), IFRS financial statements, year end 31 December, amounts in euros excluding VAT unless stated otherwise.
L1 · Guided · Year N — signature of the contract (1 February N)
On 1 February N, Corlinde Systems signs a contract with Écopôle Rivemont, a fictitious semi-public company that operates a household packaging sorting centre, for a custom-designed sorting line, manufactured in Corlinde's workshop and then installed in Écopôle's building, the training of the operators and three years of remote monitoring and maintenance, with a performance bonus. You follow this contract, from the seller's point of view, over two years and in the order of the five steps of IFRS 15: analysis of the contract and of the price at signature (level 1), allocation of the price and year-end N (level 2), amendment and completion of the line in N+1 (level 3), then the performance bonus and the N+1 closing file (level 4). All figures are case data; teaching assumptions and professional judgements are flagged as such, and no method chosen by Corlinde is presented as required by the standard. Teaching assumption: amounts are rounded to the euro and each year's entries are presented in summary form.
Standard involved: IFRS 15 Revenue from Contracts with Customers (step 1: identify the contract; step 2: identify the performance obligations; step 3: determine the transaction price). Before allocating or recognising anything, you must know which contract exists, what it promises and for what amount. Read the three documents, then answer the questions in order: each one prepares the next.
Fundamental level: the method, help and references are shown.
Method
File checklist
2 / 6 stages reached
Context · Dated fact of the file
Corlinde Systems SA, a fictitious company that designs, manufactures and installs automated sorting lines for recycling centres (340 employees), IFRS financial statements, year end 31 December, amounts in euros excluding VAT unless stated otherwise.
Initial event · L1·Year N — signature of the contract (1 February N) · Current stage
Standard involved: IFRS 15 Revenue from Contracts with Customers (step 1: identify the contract; step 2: identify the performance obligations; step 3: determine the transaction price). Before allocating or recognising anything, you must know which contract exists, what it promises and for what amount. Read the three documents, then answer the questions in order: each one prepares the next.
Pieces added
New period · L2·Year N — allocation of the price and year end at 31 December N · Upcoming: unlocks after the current stage
New period · L3·Year N+1 — January to May: amendment and completion of the line · Upcoming: unlocks after the current stage
New period · L4·Year N+1 — performance bonus and year end at 31 December N+1 · Upcoming: unlocks after the current stage
Conclusion · Upcoming: unlocks after the current stage
3 documents to work from at this level.
Document 1Contract
First level: all the data is in the brief and the pieces of this level.
5 parts to answer, marked when you submit the level.
Set out the points for and against, then decide.
Part 1 · Multiple answers · Analysis
Step 1: which findings are correct?
Several answers may be correct: select all of them.
4 more questions will appear once the current question is complete.
Your working draft for this file: points noted, leads, intermediate calculations.
Saved on this device only; never graded.
Answer every part to submit the level and see the conclusion.
Normative references