Document ID: chunk:federal_register_of_legislation:F2021L00471:body:0:p11
Version: federal_register_of_legislation:F2021L00471
Segment Type: other
Provision Reference: 
Character Range: 28370–31362

amount of data over three years.
For the handset, the entity concludes that it should recognise revenue when it satisfies the performance obligation (when it provides the handset to the customer). For the provision of data, the entity concludes that it should recognise revenue as it satisfies the performance obligation (as the entity provides data services to the customer over the three-year life of the contract).
The entity notes that, in accounting for revenue it has made judgements about:
(a) the allocation of the transaction price to the performance obligations; and
(b) the timing of satisfaction of the performance obligations.
The entity has concluded that revenue generated from these contracts is material to the reporting period.
Application
The entity notes that for contracts of this type it applies separate accounting policies for two sources of revenue, namely revenue from:
(a) the sale of handsets; and
(b) the provision of data services.
Having identified revenue from contracts of this type as material to the financial statements, the entity assesses whether accounting policy information for revenue from these contracts is, in fact, material.
The entity evaluates the effect of disclosing the accounting policy information by considering the presence of qualitative factors. The entity noted that its revenue recognition accounting policies:
(a) were unchanged during the reporting period;
(b) were not chosen from accounting policy options available in the Australian Accounting Standards;
(c) were not developed in accordance with AASB 108 Accounting Policies, Changes in Accounting Estimates and Errors in the absence of an Australian Accounting Standard that specifically applies; and
(d) are not so complex that primary users will be unable to understand the related revenue transactions without standardised descriptions of the requirements of AASB 15.
However, some of the entity's revenue recognition accounting policies relate to an area for which the entity has made significant judgements in applying its accounting policies—for example, in deciding how to allocate the transaction price to the performance obligations, and the timing of revenue recognition.
The entity considers that, in addition to disclosing the information required by paragraphs 123–126 of AASB 15 about the significant judgements made in applying AASB 15, primary users of its financial statements are likely to need to understand related accounting policy information. Consequently, the entity concludes that such accounting policy information could reasonably be expected to influence the decisions of the primary users of its financial statements. For example, understanding:
(a) how the entity allocates the transaction price to its performance obligations is likely to help users understand how each component of the transaction contributes to the entity's revenue and cash flows; and
(b) that some revenue is recognised at a point in time and some is recognised over time is