Revenue recognition

Revenue recognition for UK limited companies, get the cut-off, deferred income and contract accounting right under FRS 102 and IFRS 15 before it distorts profit and tax.

• Review of contracts, billing terms and performance obligations

• Recognition policy written and documented for your accounts

• Deferred and accrued income schedules built each period

• Multi-element, usage-based and milestone contracts unpicked

• Agent versus principal assessment on platform and pass-through revenue

• Auditor and investor questions answered with a defensible policy

Under FRS 102 revenue is recognised when the seller has transferred the significant risks and rewards, the amount can be measured reliably and economic benefit is probable. For services this means recognising as the service is delivered, so twelve months billed up front is spread across twelve months, with the unearned portion sitting on the balance sheet as deferred income.

IFRS 15 and FRS 102's revised approach both push you through the same discipline: identify the contract, identify the distinct performance obligations, work out the transaction price, allocate it across the obligations, then recognise as each is satisfied. Setup fees, discounted first years, bundled services and usage credits all fall out of that analysis.

Agent versus principal decides whether your turnover is the gross transaction value or your commission. It changes reported revenue dramatically, and it drives VAT treatment, company size thresholds, audit thresholds and every revenue multiple an investor applies.

Thresholds, rates and deadlines quoted here reflect the 2026/27 UK position. Check current GOV.UK guidance, or ask us, before you rely on them for your own company.

We start by looking at the last filed accounts, your current records and your filing dates, then confirm a fixed scope and fee in writing.

Once the work is live you get reminders ahead of each deadline, a named person to ask questions, and a plain-English summary when the figures are ready, not a PDF with no explanation.