# Revenue Recognition

*Accounting & Reporting — Finicade finance glossary*

Revenue recognition is the set of rules deciding when a sale counts as revenue — broadly, when control of the good or service transfers to the customer. Modern standards use a five-step model built on performance obligations. It's the single most manipulated area in accounting: channel stuffing, bill-and-hold arrangements and aggressive percentage-of-completion estimates all live here.

**Also known as:** rev rec, ASC 606, IFRS 15

**Related terms:** [Revenue](https://finicade.com/glossary/revenue), [Deferred Revenue](https://finicade.com/glossary/deferred-revenue), [Matching Principle](https://finicade.com/glossary/matching-principle), [Non-GAAP Earnings](https://finicade.com/glossary/non-gaap-earnings), [Accrual Accounting](https://finicade.com/glossary/accrual-accounting)

**Taught in:** Charter Climb — The Income Statement

Source: https://finicade.com/glossary/revenue-recognition