[Verse 1] When customers sign contracts, revenue waits its turn IFRS fifteen and ASC six-oh-six both concern Performance obligations must be satisfied first Before we book the dollars, let the earnings burst Control transfers to buyers, that's the magic gate Five steps guide the process, don't anticipate [Chorus] Match the costs with revenues earned Capitalize when future benefits are confirmed Depreciate the assets, straight-line or accelerated Quality earnings tell the story, not inflated Basic shares divided into net income clean Diluted adds the options to the counting machine [Verse 2] Expenses follow matching, tie them to their gain Office rent gets expensed, equipment's cost remains Research hits immediately, development might wait Software costs capitalize when technical specs are straight Discontinued operations sit below the line Separate from continuing, they help us realign [Chorus] Match the costs with revenues earned Capitalize when future benefits are confirmed Depreciate the assets, straight-line or accelerated Quality earnings tell the story, not inflated Basic shares divided into net income clean Diluted adds the options to the counting machine [Bridge] Accruals versus cash flows paint a different scene Cookie jar reserves and channel stuffing schemes Aggressive accounting smooths the bumpy ride Conservative approaches let the truth reside Anti-dilutive securities stay out of the count Treasury stock method calculates the discount [Verse 3] Other comprehensive income holds the foreign gains Pension adjustments, hedge accounting chains Available for sale securities mark to market fair These bypass net income but equity shows they're there Earnings per share weighted by the time outstanding Complex structures need careful understanding [Outro] From revenue recognition to the final EPS Income statement analysis puts skills to the test Quality over quantity, substance over form Financial truth emerges through the reporting storm
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