Time of recording the Transaction

Time of Recording the transactions

 Normally the transaction is recorded when transaction is complete. The completion of transaction must not be confused with payment. The transaction completion vary from transaction to transaction. The sales is normally recorded when the risk and rewards have been transferred to buyer. The time of completion of a transaction is basically explained in Accounting standards.

The business practices and industry practices may also be helpful to determine the stage of completion of transaction. The transaction must not be recorded when terms are being negotiated similarly transaction must not be enter in the books of accounts where it is expected that no flow of resources will occur inward or outward.

The transaction time recording is a complex issue and require many factors to be considered before the transaction is recorded and every transaction have different rules for recognition.