Revenue Recognition Agent
Revenue recognition per IFRS 15 - from contract analysis to disclosure note.
Extracts contract data, identifies separate performance obligations, determines transaction prices, calculates the degree of completion and creates journal entries and notes disclosures per the IFRS 15 five-step model.
Score Dashboard
What This Agent Does
Revenue recognition per IFRS 15 is one of the most complex accounting standards. The five-step model (identify contract, determine performance obligations, determine transaction price, allocate price, recognise revenue) requires significant human judgement for multi-element arrangements, variable consideration and over-time satisfaction.
The Decision Layer breaks revenue recognition into nine decision steps. Contract data extraction is by LLM. Identification of separate performance obligations, determination of variable consideration components and assessment of control transfer require human judgement. Price allocation with observable standalone prices and degree-of-completion calculation are rule-based or AI-supported.
The result: an agent that handles the mechanical steps and prepares the judgement decisions. Particularly relevant for software companies, construction companies and providers of multi-element arrangements. The agent is deliberately rated Q3: the high governance complexity requires a mature Decision Layer infrastructure.
Micro-Decision Table
Extract contract data What key data does the contract contain (term, services, prices)? AI Agent
LLM extraction from contracts with complex service descriptions
Decision Record
Challengeable: Yes - fully documented, reviewable by humans, objection via formal process.
Identify performance obligations Which services are distinct and form separate obligations? Human Auditor
IFRS 15 Step 2 - assessment whether services are separately usable
Decision Record
Challengeable: Yes - via manager, works council, or formal objection process.
Challengeable by: Auditor
Determine transaction price What is the transaction price including variable components? Human Auditor
Fixed price rule-based (R), variable consideration requires estimation (H)
Decision Record
Challengeable: Yes - via manager, works council, or formal objection process.
Challengeable by: Auditor
Allocate price to performance obligations How is the total price allocated to individual obligations? Human Auditor
Observable standalone prices rule-based (R), estimation for missing prices (H)
Decision Record
Challengeable: Yes - via manager, works council, or formal objection process.
Challengeable by: Auditor
Determine point or period of revenue recognition When does control transfer to the customer? Human Auditor
Assessment of control transfer per IFRS 15 Step 5
Decision Record
Challengeable: Yes - via manager, works council, or formal objection process.
Challengeable by: Auditor
Calculate degree of completion How far has performance progressed? Rules Engine Auditor
Input method (costs) or output method (milestones) - R for clear metrics, A for interpretation
Decision Record
Challengeable: Yes - rule application verifiable. Objection possible for incorrect data or wrong rule version.
Challengeable by: Auditor
Create journal entry What are the journal entries for recognised revenue? Rules Engine Auditor
Posting logic: receivable to revenue, proportional per progress
Decision Record
Challengeable: Yes - rule application verifiable. Objection possible for incorrect data or wrong rule version.
Challengeable by: Auditor
Calculate contract balances What are contract asset and contract liability? Rules Engine Auditor
Arithmetic: difference between recognised revenue and received payments
Decision Record
Challengeable: Yes - rule application verifiable. Objection possible for incorrect data or wrong rule version.
Challengeable by: Auditor
Prepare disclosure notes Which notes disclosures are required per IFRS 15? AI Agent Auditor
LLM draft of disclosure notes based on portfolio data
Decision Record
Challengeable: Yes - fully documented, reviewable by humans, objection via formal process.
Challengeable by: Auditor
Decision Record and Right to Challenge
Every decision this agent makes or prepares is documented in a complete decision record. Affected parties (employees, suppliers, auditors) can review, understand, and challenge every individual decision.
Prerequisites
- Contract management system with digitised contracts
- ERP system with revenue recognition module (SAP RAR, Oracle Revenue Management or equivalent)
- Defined methodology for progress measurement (input vs. output)
- Historical contract data for variable consideration estimates
- GL interface for posting transfer
Governance Notes
High human share (3H / 3R / 2A / 1 R/H). IFRS 15 requires human judgement at several points: identification of separate performance obligations, estimation of variable consideration, assessment of control transfer. The agent automates the mechanical steps and prepares the judgement decisions.
Balance-sheet-relevant and audit-sensitive: revenue recognition is an audit focus. The statutory auditor reviews in particular the identification of separate performance obligations and the appropriateness of variable consideration estimates. GoBD-compliant: every revenue recognition decision is archived with contract, methodology and calculation. Paragraph 203 StGB relevant: contract data and revenue are highly sensitive business information.
§203 StGB-relevant data is encrypted end-to-end and never passed to AI models in plain text.
Process Documentation Contribution
Infrastructure Contribution
The Revenue Recognition Agent demonstrates the pattern for judgement-intensive agents: high human share but with structured decision preparation. The contract extraction uses the same LLM infrastructure as the Lease Accounting Agent and Contract Compliance Agent. The degree-of-completion calculation is a reusable pattern for all agents with over-time satisfaction. The disclosure note generation by LLM is reused for all notes (provisions, leasing, segment reporting). Builds Decision Logging and Audit Trail used by the Decision Layer for traceability and challengeability of every decision.
Does this agent fit your process?
We analyse your specific finance process and show how this agent fits into your system landscape. 30 minutes, no preparation needed.
Analyse your processRelated Agents
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Accruals Agent
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Frequently Asked Questions
Is the agent also relevant for HGB revenue recognition?
Primarily the agent is designed for IFRS 15. HGB revenue recognition is simpler (realisation principle per HGB Paragraph 252), but for multi-element arrangements and long-term construction, similar questions arise. The agent can be configured for both standards.
For which companies is the agent particularly relevant?
Particularly relevant for software companies (licence plus service plus support as separate performance obligations), construction companies (over-time satisfaction by construction progress) and industrial companies with complex multi-element arrangements (machine plus installation plus maintenance).
Why is the agent in Q3 and not Q1?
The high governance complexity (3 human decision points, discretion for every contract) requires a mature Decision Layer infrastructure. Companies should first gain experience with rule-based agents (Q1) before automating judgement-intensive processes.
What Happens Next?
30 minutes
Initial call
We analyse your process and identify the optimal starting point.
1 week
Discover
Mapping your decision logic. Rule sets documented, Decision Layer designed.
3-4 weeks
Build
Production agent in your infrastructure. Governance, audit trail, cert-ready from day 1.
12-18 months
Self-sufficient
Full access to source code, prompts and rule versions. No vendor lock-in.
Implement This Agent?
We assess your finance process landscape and show how this agent fits your infrastructure.