From vague disclosures and premature revenue recognition to missing reconciliations, many companies continue to fall short of the requirements under Ind AS 115. With practical examples, suggested formats, and relevant regulatory extracts, the article offers actionable insights for auditors to strengthen transparency and compliance in financial reporting. It discusses the top five non-compliances in revenue recognition under Ind AS 115, as observed by the FRRB, including:
‣ Failure to Disaggregate Revenue – Reporting total revenue without breaking it down by product, geography, or sales channel.
‣ Missing Disclosure on Revenue Recognition Methods – Using vague phrases like “stage of completion” without explaining the input or output method.
‣ No Reconciliation of Revenue with Contracted Price – Omitting details of discounts, credits, or rebates deducted from the contract value.
‣ Premature Recognition of Arbitrations – Recording revenue on claims or awards that are not yet enforceable.
