Where the outcome of a transaction involving the rendering of services can be estimated reliably, the entity should recognise the revenue associated with the transaction by reference to the percentage of completion of the transaction at the end of the reporting period (discussed later). The outcome of a transaction can be reliably estimated when all of the following conditions are satisfied;

• The amount of revenue can be measured reliably.
• It is probable that the economic benefits of the transaction will flow to the entity.
• The stage of completion of the transaction at the end of the reporting period can be measured reliably
• The costs incurred for the transaction and the costs to complete the transaction can be measured reliably.

If the service provided involves an as yet undetermined number of acts over a specified period of time then the entity should recognise the revenue on a straight line basis over the period unless there is evidence to suggest that there is another method which better represents the stage of completion. Where a specific act is much more significant than any other act, the entity postpones recognition of revenue until the act is executed. Where the outcome of the transaction involving the rendering of services cannot be estimated reliably, an entity should recognise revenue only to the extent of the expenses that can be recovered.

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