September 2012
Intermediate to advanced
278 pages
7h 58m
English
Content preview from Finance for IT Decision Makers, 3rd Edition
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A4 ACCOUNTING FOR LONG-TERM CONTRACTS
A contract is regarded as long-term if the time taken to complete it falls into different accounting periods. A contract requiring to be accounted for as ‘long-term’ will usually extend for a period exceeding one year. However, shorter contracts may fall within the requirement where not to do so would lead to distortion of the results. I would concede that the detailed accounting for long-term contracts belongs in ‘deep accounting’ territory, and there will of course be differences of detail between countries. However, the following few paragraphs are intended to summarise the main principles for the non-specialist.
Obviously the precise financial outcome of a long-term contract will only be known on its ...
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