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What are the ailments and drawbacks of Accrued Income in revenues recognition in contracting companies ?

While recognizing Revenue of a project having life of over ONE Year, it gives a tough time to adjust accrued income against revenues, therefore there would be need to exert a great care while ascertaining the percentage of completion of project.

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Question added by Deleted user
Date Posted: 2013/10/25
James Mwangi
by James Mwangi , junior accountant , HENRY SMITH &WILSON AUDIT FIRM

Its cumbersome to account for accrued revenues for big projects running for more than one year eg construction projects

Ramy Chami
by Ramy Chami , Sr. Projects Director , Egis

It all depends on tax brackets, and how revenues are collected against what is claimed.

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