Circular 9/2006 - Transactions giving rise to adjustments to revenue/purchases Cover page

This circular only deals with the initial accounting by sellers (buyers) of goods in transactions that involve cash discounts, settlement discounts and other rebates (either given or received), and extended payment terms. The circular only considers the specific topics of cash discounts, settlements discounts, rebates, and extended payment terms to the extent that they were considered by the IFRIC. Other factors such as the subsequent measurement of these discounts and rebates, estimations of contingent rebates and the deferred tax implications are not addressed. This Circular applies only to those entities that are still applying IAS 18 – Revenue. Entities that have adopted IFRS 15 – Revenue from Contracts with Customers should not refer to this Circular for guidance. Matters on discounts, rebates and extended payment terms are addressed under ‘variable considerations’ in IFRS 15