Quarterly report pursuant to Section 13 or 15(d)

Sales, Contract Assets and Contract Liabilities

v3.19.2
Sales, Contract Assets and Contract Liabilities
3 Months Ended
Jun. 30, 2019
Notes to Financial Statements  
Sales, Contract Assets and Contract Liabilities
8. Sales, Contract Assets and Contract Liabilities

 

The Company has analyzed its sales contracts under ASC 606 and has identified performance conditions that are not directly correlated with contractual payment terms with customer. As a result of the timing differences between customer payments and satisfaction of performance conditions, contractual assets and contractual liabilities have been recognized.

 

Contracts are tailored to meet each customer's unique requirements. However, the Company's performance obligations can generally be identified as:

 

Specified service works
Certified design and engineering works
Delivered equipment to customers
Commissioned equipment

 

For the three months ended June 30, 2019, the Company recognized sales revenues in proportion to performance obligations as noted below:

 

    2019
$
 
       
Specified service works     -  
Certified design and engineering works     1,672,927  
Delivered equipment to customers, net of obligations     2,788,212  
Commissioned equipment     303,096  
         
Total     4,764,235  

 

Changes in the Company's contract assets and liabilities for the periods are noted as below:

 

    Contract Assets
$
    Sales
(Cost of sales)
$
    Contract Liabilities
$
 
                   
Balance, March 31, 2018                  
                         
Customer receipts and receivables                 (20,925,437 )
Sales recognized in earnings           2,074,950       2,074,950  
Payments under contracts     14,172,975              
Costs recognized in earnings     (1,935,150 )     (1,935,150 )      
                         
Balance, March 31, 2019     12,237,825               (18,850,487 )
                         
Customer receipts and receivables                 (20,651,188 )
Sales recognized in earnings           4,764,235       4,764,235  
Payments and accruals under contracts     12,474,173              
Costs recognized in earnings     (2,817,913 )     (2,817,913 )      
                         
Balance, June 30, 2019     21,894,085               (34,737,440 )