ASPE – Construction industry
This training activity explores the Part II – Accounting Standard for Private Enterprises (ASPE) that are applicable to the construction industry in a practical manner. For the purposes of this training activity, construction industry includes construction contractors with various activities. A contractor may engage in those activities as a general contractor or subcontractor, and does not necessarily have the ownership of real estate, but is acting as a vendor to the builders, developers and landlords that have direct or indirect ownership of the real estate. The training activity will also cover the disclosure requirements and other issues specific to construction contracts.
As the construction industry continues to become a larger part of the Canadian economy, a similar increase in the level of complexity of industry practices has been observed. This leaves practitioners with the challenge of applying the standard in this ever-changing landscape. This training activity is designed to enable the practical application of the ASPE standard to construction entities. Emphasis will be placed on the application of revenue recognition and other accounting policies using specific scenarios and practical illustrative examples.
ObjectivesBy the end of this training activity, participants will be able to:
- identify common industry practices and accounting policies;
- interpret financial statement presentation and disclosure requirements;
- analyze the effects of estimates and uncertainty in the application of revenue recognition;
- distinguish the appropriate application of the percentage of completion and completed contract methods of revenue recognition.
- Common business practices in the construction industry
- Revenue recognition under the percentage of completion method
- Revenue recognition under the completed contract method
- Unbilled receivable and deferred revenue
- Holdbacks receivable and payable
- Other financial reporting implications:
- Change orders
- Incentives and penalties
This course will benefit professional accountants who work with or are interested in financial reporting and related areas of accounting in the construction industry, as well as anyone involved in financial reporting and corporate accounting under ASPE, including CFOs, VPs of finance, and controllers.
Participants should be familiar with CPA Handbook – Accounting Part II ASPE and have knowledge of the construction industry business practices