IFRS IC agenda decision on the recognition of revenue from tuition fees

In the fact pattern considered by the Committee, students attend the educational institution for approximately 10 months of the year (the ‘academic year’) and receive teaching services over that period. Academic staff takes a four-week holiday and uses the remaining month to wrap up the previous year and prepare for the next one. During these two months, staff is paid but do not provide teaching services strictly speaking. Under IFRS 15, the educational institution recognises revenue from tuition fees over time.  

The Committee was asked whether the educational institution is required to recognise that revenue evenly over the academic year (10 months), evenly over the annual reporting period (12 months) or over a different period.  

In its decision, the Committee reached no conclusion on the question raised concerning the period over which revenue should be recognised in accordance with IFRS 15. This is a matter of judgment, resulting from differing facts and circumstances. The Committee merely points out that, in practice, there is no observed diversity in the accounting treatment of tuition fees in similar contexts. It therefore concluded that the existing provisions in the standard are sufficient to deal with the topic. 

IFRIC Update March 2025