The Handbook to IFRS Transition and to IFRS U.S. GAAP Dual Reporting

4.5 AGGREGATIONS AND SUBTOTALS

4.5.1 Gross, Net Sales, and Other Revenues

4.5.1.1 Terminology

44% in 2009, 46% in 2005, and 50% in 2002 of the survey U.S. GAAP companies used the term “net sales” alone or in combination with other terms; 43%, 38%, and 33%, respectively, “revenues”; and approximately 13%, 16%, and 17%, respectively, “sales” alone or in combination with other terms. Approximately 2–4% combined operating revenues in the same caption of net sales or sales.109

4.5.1.2 Minimum Line Items

IAS 1 lists revenue as part of the minimum content to display in the statement of comprehensive income.110 On one hand, IAS 18 defines revenue in terms of gross inflows of economic benefits.111 On the other hand, it measures revenue based on fair value of consideration received or receivable after deducting items, such as trade discounts and volume rebates.112

Comment: Arguably, the gross inflows concept in IAS 18 mainly refers to a gross-of-cost concept, and not to items that are ancillary to the sales transaction. This concept is rooted in the IASB Framework and the U.S. concepts (see Paragraph 4.5.5 following).

Example: A Swedish foreign private issuer explained to the SEC Staff that it reported net revenue under IFRSs, after deducting sales discounts and sales returns. The SEC Staff requested the company to disclose the accounting policy followed.113

4.5.1.3 Presentation of Discounts, Allowances, and Returns

Some IFRSs nonauthorative literature provides some guidance ...