Why this is mistaken
Identify each specified good or service, then evaluate whether the entity controls it before transfer. Inventory risk, discretion, responsibility, legal form, and cash flow are evidence, not standalone rules.
Where to watch
When this mistake may appear
- We bill the customer.
- The intermediary remits cash net of a fee.
Check your work
Your work may contain this mistake if:
- Uses cash direction as the conclusion.
- Lists indicators without identifying the specified good or service.
- Reports the wrong revenue amount even if timing is correct.