EFRAG discusses accounting for variable consideration

EFRAG has published a discussion paper on the accounting for variable consideration.

The discussion paper focusses on issues faced by purchaser entities. Variable consideration related to the acquisition of a business covered by IFRS 3 is outside the scope of this Discussion Paper.

Alternative approaches on the two following research questions are discussed:

• When should a liability for variable consideration be recognised?
• Whether and when do subsequent changes of the variable consideration cause the acquisition cost to be adjusted?

In addition, the discussion paper assesses the general IFRS requirements for variable consideration. It is intended to foster the debate on a proper accounting for variable consideration and to contribute to any future related work by the IASB.

Comments are welcome by 31 May 2023.