Quarterly report pursuant to Section 13 or 15(d)

Sales, Contract Assets and Contract Liabilities

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Sales, Contract Assets and Contract Liabilities
9 Months Ended
Dec. 31, 2019
Sales, Contract Assets and Contract Liabilities [Abstract]  
Sales, Contract Assets and Contract Liabilities
9. 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

 

Equipment delivery and acceptance

 

Installation and commissioning

 

For the three and nine months ended December 31, 2019, the Company recognized sales revenues in proportion to performance obligations as noted below:

 

    Three Months Ended
December 31, 2019
$
    Nine Months Ended
December 31,
2019
$
 
             
Specified service works     -       381,338  
Certified design and engineering works     9,779,337       21,517,289  
Delivered equipment to customers, net of obligations     19,273,700       69,697,153  
Installed and commissioned equipment     8,468,912       13,428,9487  
                 
Total     37,521,949       105,024,728  

 

There were no revenues for the comparative periods ended December 31, 2018.

 

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 and accruals 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                 (113,778,605 )
Sales recognized in earnings           105,024,728       105,024,728  
Payments and accruals under contracts*     72,854,661              
Costs recognized in earnings     (63,067,989 )     (63,067,989 )      
                         
Balance, December 31, 2019     22,024,497               (27,604,364 )

 

* Payments and accruals under contracts includes $11,433,348 presented as receivables which is subject to the fulfillment of future performance obligations.