Sellers are only required to adjust the transaction price to reflect the time value of money when the contract has a significant financing component.

Question

Quizplus · Accepted Answer

According to IFRS 15, a significant financing component exists when the timing of payments agreed by the parties to a contract provides the customer or the entity with a significant benefit of financing the transfer of goods or services to the customer. In such cases, the transaction price needs to be adjusted to reflect the time value of money.

Sellers Are Only Required to Adjust the Transaction Price to Reflect