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Notes to the
financial statements
For the financial year ended 31 December 2018
75
A N N U A L R E P O R T
2 0 1 8
2.
Summary of significant accounting policies (cont’d)
2.2
First-time adoption of Singapore Financial Reporting Standards (International) (SFRS(I))
(cont’d)
SFRS(I) 15 Revenue from Contracts with Customers
The Group has applied SFRS(I) 15 for the first time in the current financial year. SFRS(I) 15
superseded SFRS 18 “Revenue”, SFRS 11 “Construction Contracts” and the related interpretations.
The Group recognises revenue from the design, construction, operating and chartering of mobile
offshore units and offshore services vessels, along with the manufacturing and providing specialised
marine offshore equipment and services for the oil and gas industry.
SFRS(I) 15 introduces a 5-step when recognising revenue:
•
Step 1:
Identify the contract(s) with a customer
•
Step 2:
Identify the performance obligations in the contract
•
Step 3:
Determine the transaction price
•
Step 4:
Allocate the transaction price to the performance obligations in the contract
•
Step 5:
Recognise revenue when (or as) the Group satisfies a performance obligation
Under SFRS(I) 15, the Group recognises revenue when (or as) a performance obligation is satisfied,
i.e. when “control” of the goods or services underlying the particular performance obligation is
transferred to the customer.
A performance obligation represents a good and service (or a bundle of goods or services) that is
distinct or a series of distinct goods or services that are substantially the same.
Control is transferred over time and revenue is recognised over time by reference to the progress
towards complete satisfaction of the relevant performance obligation if one of the following
criteria is met:
•
the customer simultaneously receives and consumes the benefits provided by the Group’s
performance as the Group performs;
•
the Group’s performance creates and enhances an asset that the customer controls as the
Group performs; or
•
the Group’s performance does not create an asset with an alternative use to the Group and
the Group has an enforceable right to payment for performance completed to date.