Key requirements
IRAS accepts revenue under FRS 115 or SFRS(I) 15 unless it significantly departs from tax principles. Deferring all profit until 100% completion is not accepted merely because a completed-contract method is used internally. A minimum completion threshold needs evidence showing why it is reasonable, rather than adopting a customary percentage without support. Contract revenue and cost recognition on different bases is acceptable only where the accounting standard permits it. Review retention sums, project provisions and deductions against the detailed scenarios, and keep project records that substantiate stage of completion and adjustments. Accounting expenditure still needs screening for capital items and statutory disallowances.
Official source
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