AASB 15: Revenue Recognition from Contracts with Customers

AASB 15 is known as basic accounting standard to ensure revenue recognition from contacts
with customers. This standard has contributed with significant changes in the recognition of
revenue and respective profit. The changes and impacts of AASB 15 through amendment should
be treated with due importance. (AASB, 2014) Right from proposal through exposure draft for
implementation up to the level of amendment proposal through exposure drafts, there is no
significant barrier to get it enforced. As any business needs recognition of revenue from goods
and contract, this is one of the basic standards to be fixed for setting of accounting standards.
AASB 15 emphasizes the role of revenue from customer and contract with amendment, and the
sanction process of the same was smooth with normal routine of proposal followed by comment
letters and their study, and then approval by the Board for implementation with logical changes.
The political pressure may come from the act of regulation view point, when the people with
special interest try to intervene with their political influence to change the accounting standard to
their favor. In this context of AASB 15 implementation, there is no such incident noticed through
news. The proposed standard is set without any intervention from political process. There may be
some intervention to pamper private interest theory with the comments on issues, which may
harm self-interest of the limited section of stakeholders. But there is no significant proof of
intervention of political entities to exercise the capture theory. As per the literature, Changes to
revenue recognition – don’t be caught out written by Ralph martin and published in RSM Global
on 14.05.2018, detailed discussion was there to understand the route map of this standard right
from inception up to date through amendments. (Martin, 2018)The standard is getting more
appropriate with its approach toward financial accounting standard. As Australian Accounting
Standard Board is a government unit and acts as the representative of the government for
accounting standard setting ensuring effective convergence with other global accounting
standard boards, AASB has no such threat to face the implication of regulatory capture theory by
outsiders with power and political influence. Hence, there is no such intervention found in the
accounting standard setting process of AASB 15 from political personalities or entities. Clear
identification of the objective of accounting standard is to be described to secure the interest of
the stakeholders to ensure its honest application and prudent presentation in financial reporting.
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