The Influence Of New Revenue Standard On Construction Enterprise

With tremendous changes taking place in the current world structure and economy circumstance,integration of world economy is strengthening.In order to reduce the risk of economy trade,IASB and FASB issued new Customer Contract Income standard(IFRS15)in 2014,which is a milestone in international revenue standard history.The Ministry of Finance of China basing the background that international and Chinese accounting standards has a convergence,released “CAS No.14-Income” officially in 2017.The newest revenue standard has a new model called“five-step method” which the original income standard and construction contract standard use this method both to recognize revenue.With the using of “five-step method”,we can reply the complex business transactions.Because of the long construction period and complex contracts,construction companies has several problems among all of the business to reply the new revenue standard.Construction companies have different kinds of management models including BOT、PPP and EPC which make the recognition of revenue more complex.In order to reflect the management performance accurately,enhance the quality of accounting information,this paper analyses the influence for the construction companies when they use new revenue standard.At first,this paper does an introduction about the background of the birth of new revenue standard.In the meantime,this paper lists relevant domestic and foreign literature,including literature about construction industry.Secondly,this paper gives a brief introduction for development of revenue standard worldwide.In the meanwhile,analyse the theory for revenue standard and explain the significant difference for the change.Then,explain the significant change which influence the construction companies.From accounting information quality perspective,explain the significant changes in construction companies.Then,choose Sichuan Road & Bridge as a case to analyse,introduce the basic information,service distribution and the combination of revenue for the company.Under the background that Sichuan Road & Bridge changes to new revenue standard in 2020,analyse the influence for revenue recognition and financial statements.And how managers,shareholders and creditors face the changes.At last,make suggestions on how construction companies carry out new revenue standard.And make some advice to control and prevent the difficulties may face during carrying out the new standard.