Long-term contract accounting training

Prerequisites

A basic knowledge of accounting is required.

What are the training objectives?

◗ Integrating the fundamental principles of IFRS 15 and their specific application to long-term contracts

◗ Apply the percentage-of-completion method (over time) and deal with special cases (variable clauses, contract amendments, losses on completion, etc.).

◗ Present adequate information in the appendix

◗ Anticipating the impact on performance indicators and financial communication

Training program

◗ The challenge of revenue recognition in the major projects sector

✔ UNDERSTANDING | Illustration: group financial communication
✔ APPLY | Case study: measuring the impact on sales and margins of
over time or point-in-time revenue recognition.

◗ IFRS 15's 5-step model for long-term projects

- Review of each of the 5 stages of the standard, illustrated by concrete examples

✔ UNDERSTAND | Illustration: decision tree to determine recognition of CA.
✔ UNDERSTAND | Brainstorming: is ESMA's decision regarding recognition
recognition of a shipyard?
✔ APPLY | Case study: measuring the impact on sales and margins of a combination
combination (or not) of contracts

◗ Over-time accounting

- Measuring progress
- Contract costs, costs of obtaining the contract, indirect costs, uncertainties and risks
(contingencies), inefficiency treatment

✔ APPLY | Case study: accounting for a simple percentage-of-completion contract ;
calculate percentage of completion, sales and margin at each stage.
✔ UNDERSTAND | Brainstorming: how to account for expenses that can be used
multiple contracts?
✔ APPLY | Case study: measuring and accounting for the impact of a change in the
of contract cost estimates :
- whether or not to include an expense in contract costs
- whether or not to include inefficiency costs in contract costs
✔ APPLY | Case study: taking account of uncertainties and risks (contingencies)
✔ APPLY | Case study: recognizing a warranty provision in a long-term contract
long-term contract

◗ Special cases

- Contract modifications: the various modifications and their impact on the current contract
- Loss-making contracts: treatment of losses on completion
- Price calculation (special cases): financing component, performance conditions,
penalties, variable prices, etc.

✔ UNDERSTAND | Illustration: decision tree for different contract modifications
✔ APPLY | Case study: measure the impact of a contract modification on the sales and margin of a current contract, determine the accounting treatment to be applied.
margin of a current contract, determine the accounting treatment
✔ APPLY | Case study: accounting for a loss on completion over time
✔ UNDERSTAND | Illustration: applying the limit in the case of a performance
penalty

◗ Long-term Group contracts

- Multi-entity contracts and margin sharing, consolidation adjustments
- Notes to the financial statements

✔ APPLIQUER | Case study: determining consolidation adjustments for a contract
contract in a group
✔ UNDERSTAND | Illustration: recent group appendices in the projects sector

Why choose this course?

Long-term contracts represent a key accounting challenge for project-based industries such as construction, engineering, IT and defense. They involve major accounting specificities linked to the duration of execution, uncertainty over costs and revenues, and the diversity of performance obligations.
In just 2 days, this highly applied training course enables you to anticipate the concrete impacts on sales, margins and key indicators of all the events that occur during the course of a complex project.

Teaching and assessment methods

Before: self-assessment quiz

During the session: each point covered is accompanied by one or more practical case studies to be carried out on Excel by participants. Illustrations and examples of real-life cases
are used throughout the course. Discussions during the session ensure that participants are fully aware of what they have learned.

Afterwards: documentation. The trainer is available to answer any questions relating to the training.

General training | FinHarmony Conseil & Formation

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Price

1295 € EXCL. TAX

Testimonials

Jonathan C.
Company
Training

Generalist trainings