AS 9 - 128 Accounting Standard(AS 9(issued 1985 Revenue...

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128 Accounting Standard (AS) 9 (issued 1985) Revenue Recognition Contents INTRODUCTION Paragraphs 1-4 Definitions 4 EXPLANATION 5-9 Sale of Goods 6 Rendering of Services 7 The Use by Others of Enterprise Resources Yielding Interest, Royalties and Dividends 8 Effect of Uncertainties on Revenue Recognition 9 ACCOUNTING STANDARD 10-14 Disclosure 14 APPENDIX The following Accounting Standards Interpretation (ASI) relates to AS 9: Revised ASI 14 - Disclosure of Revenue from Sales Transactions The above Interpretation is published elsewhere in this Compendium.
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Accounting Standard (AS) 9 (issued 1985) Revenue Recognition (This Accounting Standard includes paragraphs 10-14 set in bold italic type and paragraphs 1-9 set in plain type, which have equal authority. Paragraphs in bold italic type indicate the main principles. This Accounting Standard should be read in the context of the Preface to the Statements of Accounting Standards 1 .) The following is the text of the Accounting Standard (AS) 9 issued by the Institute of Chartered Accountants of India on ‘Revenue Recognition’. 2 In the initial years, this accounting standard will be recommendatory in character. During this period, this standard is recommended for use by companieslistedonarecognisedstockexchangeandotherlargecommercial, industrial and business enterprises in the public and private sectors. 3 Introduction 1. This Statement deals with the bases for recognition of revenue in the statement of profit and loss of an enterprise. The Statement is concerned with the recognition of revenue arising in the course of the ordinaryactivities of the enterprise from the sale of goods, 4 1 Attention is specifically drawn to paragraph 4.3 of the Preface, according to which Accounting Standards are intended to apply only to items which are material. 2 It is reiterated that this Accounting Standard (as is the case of other accounting standards) assumes that the three fundamental accounting assumptions i.e., going concern, consistency and accrual have been followed in the preparation and presentation of financial statements. 3 It may be noted that this Accounting Standard is now mandatory. Reference may be made to the section titled ‘Announcements of the Council regarding status of various documents issued by the Institute of Chartered Accountants of India’ appearing at the beginning of this Compendium for a detailed discussion on the implications of the mandatory status of an accounting standard. 4 See also revised Accounting Standards Interpretation (ASI) 14, which is published elsewhere in this Compendium.
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130 AS 9 (issued 1985) the rendering of services, and the use by others of enterprise resources yielding interest, royalties and dividends. 2. This Statement does not deal with the following aspects of revenue recognition to which special considerations apply: (i) Revenue arising from construction contracts; 5 (ii) Revenue arising from hire-purchase, lease agreements; (iii) Revenue arising from government grants and other similar subsidies; (iv) Revenue of insurance companies arising from insurance contracts.
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