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Simple guide on the way to Combine Contract

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How to Combine Contract

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hey hi everyone welcome to thames valley branch of apms first webinar and series of nec specific webinars so im really pleased to have richard patterson here today um richard works for mcdonalds he is there in lead on drafting and nec germans richard has many many years of experience not only in drafting the nec four documents but hes written many publications and applied the contract throughout the world many projects so please save up your most difficult questions um just on that point weve got a couple of sidereel questions to start with and so please use slido when its appropriate but other than that if you have questions throughout the presentation please feel free to add them into the questions on your control panel and well just pause richard and another questions at the specific points so to you richards okay well welcome everybody um thank you very much for for signing in i hope theres not too many desperately worried about wish missing the second half of the welsh gam

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What criteria needs to be met for a contract to exist IFRS 15?

For a contract to fall into the scope of IFRS 15, it must be probable that the entity will collect the consideration to which it will be entitled. Paragraph IFRS 15. BC45 specifies that both the customers ability (i.e. financial capacity) and intent to pay should be taken into account in this assessment.

When should contracts be combined?

Contracts should also be combined if the performance provided under one contract affects the consideration to be paid under another contract. This would be the case when failure to perform under one contract affects the amount paid under another contract.

What is a contract combination?

Combined Contracts means any contracts, arrangements or agreements that apply to the Assets and to any other business or asset of Sellers and their Affiliates. Combined Contracts means contracts between Seller and Customers that include Managed Services and Other Services in the same contract.

How do you bind two contracts?

To make a contract binding, it needs to include several key elements: Offer and acceptance One party needs to offer something (money, services, rights, etc.), and the other party needs to accept the offer. Consideration The benefit that both parties receive. This can be money, services, items, or anything of value.

What is a contract modification in accounting?

A contract modification could change the scope of the contract, the price of the contract, or both. A contract modification exists when the parties to the contract approve the modification either in writing, orally, or based on the parties customary business practices.

What is the criteria for contract combination under IFRS 15?

Contract Combinations under IFRS 15 IFRS 15.17 outlines the criteria for determining when an entity combines two or more contracts and accounts for them as a single contract. The key criteria being Are the contracts entered into at or near the same time with the same customer or related parties of the customer?

What is ASC 606 revenue recognition?

ASC 606 directs entities to recognize revenue when the promised goods or services are transferred to the customer. The amount of revenue recognized should equal the total consideration an entity expects to receive in return for the goods or services.

What is the core principle of IFRS 15 revenue from contracts with customers?

The core principle of IFRS 15 is that an entity will recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services.

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