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15-301MR Academies Australasia reduces reported revenue
ASIC has welcomed the decision by Academies Australasia Group Limited (Academies) to recognise revenue from tuition services over the period that the services are provided.
This follows ASIC raising concerns with Academies regarding the recognition of the majority of revenue from the provision of tuition services at the time of enrolling students in its' financial report for the year ended 30 June 2014.
Academies has elected to early adopt Australian Accounting Standard AASB 15 Revenue from Contracts with Customers in its 30 June 2015 financial report. This means it now recognises revenue over the period that tuition is provided rather than recognising most of the revenue when students are enrolled. This delays revenue recognition and increases the liability for unearned tuition income.
Revenue recognition continues to be an area of focus in ASIC's financial reporting surveillance program, as outlined in 15-139MR Focus areas for 30 June 2015 financial reports.