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Chapter 7

2.2 Substance and revenue

Examples exist where legally it appears that a sale has occurred but, with
consideration of the substance of the arrangement, a different transaction is
accounted for.

Examples relevant for F2 include:

 sale or return arrangements (consignment inventory)

 factoring (see Chapter 3, section 4.4)

 sale or buyback arrangements.

Consideration of whether RISKS and REWARDS have transferred will determine the
appropriate accounting treatments.

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