OFFICE USE ONLY
ACC1030 INTRODUCTION TO FINANCIAL ACCOUNTING
ACC1030 Mr Alan Serry
Page 2 of 9
The Metropolitan Golf club is a sporting club that charges membership fees. An upfront
membership fee is payable on joining the club. In addition, an annual fee is also charged, at
the commencement of each year. Both fees are non-refundable
In the light of the definition and recognition criteria contained in the Australian
Conceptual Framework, should Metropolitan recognise the two types of fees as
income at time of receipt? Justify your answer.
Briefly explain any inconsistencies in AASB 118 in relation to the criterion for
revenue recognition in the case of membership fees?