The Research On The Impact Of The Application Of IFRS15

In May 2014,the International Accounting Standards Board(IASB)issued “IFRS15 – Revenue from Contracts with Customers”(IFRS15,New accounting standard),which is effective for annual periods beginning on or after 1 January 2018.Earlier application is permitted.IFRS15 supersedes “IAS18 – Revenue”(IAS18,Old standard,Current standard)and other sales related standards.The IFRS15 is quite different from the current revenue related standards,which have a comprehensive impact on company’s financial report.Firstly,I studied the new standard and the old standard,trying to find their respective frameworks and key contents,to find their difference.Secondly,I performed an analysis on a typical sales contract to find the impact on the accounting treatment when IFRS15 is implemented.Thirdly,I tried to prepare the financial statements for the following years when IFRS15 is implemented to see the trend of the key financial data and to analysis the reason behind it.Lastly,I summarized the possible impacts the IFRS15 may cause on the accounting,information system and internal control,etc,and provide management suggestions.Through the comparison and analysis,I found there will be substantive change on the sales recognition of mould sales when the group implement IFRS15.To be more specific,the delivery of mould should be combined with the delivery of related spare parts,it is recognized gradually though the delivery of the spare parts,while the sales of mould is all recognized when the title is transferred to the customer under the old standard.The operate result will be worse in the first year IFRS15 is implemented and it will recover in the following years until the fourth year when the operate result return to the figure when new standard is not implemented.The impact level is related to the portion of the mould.The implement of IFRS15 will have a lot of impact on the group.For example,the stock price of the gourp,the credit policy provided by the bank,the requirement on the accounting stuffs,the contract keeping,the performance management,etc.The group need to be well prepared in accounting arrangement,communication,training and study,information system,internal control,etc to make sure the unfavorable impact will be minimized.