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IFRS 15Workpapers (Step 4 of 5)

Workpaper assignment

Step 4 of 5
Mission · workpaperWorkpaper · IFRS 15L3 · Advanced

Documents

Construction contract

Contract

Construction contract

Construction contract signed on 1 March 20X1: fixed price excluding taxes 10,000,000. The warehouse is built on land owned by Logistique Cérans; the works become the customer's property as they are incorporated into the land and the customer may request changes during construction. Invoicing upon reaching technical milestones certified by the customer's architect, invoices payable within 45 days; outside these milestones, Lorvane has no right to invoice the work performed. Memo of the contract analysis team (case data): the design, construction and integration of the various work packages form a single performance obligation.

Timing of revenue recognition and contract balances: Year 20X2 after modification

Construction contract: cost-based progress, modification and contract asset

6 documents9 sections to document
0 / 6 sections completed
Guided mode

Section 1 of 9

Objective

In progress
Section brief
What to document
The engagement, its scope and the working mode chosen.
Why
A workpaper answers one precise question: framing it avoids off-topic work.
How
Read the objective and the assignment, then choose the mode (guided, semi-guided, professional).
Expected result
You know which question the workpaper must settle, and for which reporting date.
Your role
Preparer of the IFRS 15 workpaper
Level
Advanced
Estimated time
≈ 45 min
Progress
0 / 5 steps done (review excluded)

Context

Bâtiments Lorvane SA (a fictitious entity) is building a warehouse for Logistique Cérans SAS (a fictitious entity) on land owned by the customer. The contract was signed on 1 March 20X1 and the works are due to be completed at the end of 20X3. Lorvane's reporting date is 31 December and it does not publish interim financial statements. You are preparing the contract schedule for the years 20X1 and 20X2.

Assignment

Revenue recognition schedule workpaper, years 20X1 and 20X2.

Purpose of the workpaper

Step 5: determine whether the obligation is satisfied over time or at a point in time, measure progress, account for contract modifications, calculate revenue for the period and the contract balance, then record the entries.

Questions of the file covered by this workpaper

  • Calculate the cumulative revenue at the end of 20X1 and of 20X2.
  • Calculate the revenue of each year.
  • Calculate the contract balance at the end of 20X1 and of 20X2.
  • Record the entries of the year 20X1.
  • Record the entries of the year 20X2.

Documents in the file

Open the documents to pick out the relevant information.

Choose how you want to work
View the workpaper template