Page 182 - F2 Integrated Workbook STUDENT 2019
P. 182
Chapter 7
1.7.1 Transfer of control – specific applications
Examples exist where, from a legal perspective, it appears that a sale has occurred
but, with consideration of the terms and conditions of the arrangement, control may
not have passed to the customer. As a result, revenue may not be recorded.
Examples relevant for F2 include:
sale or return arrangements (consignment inventory)
factoring (see Chapter 3, section 4.4)
sale or buyback arrangements.
An entity controls an asset if it can direct its use and obtain its remaining
benefits.
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