Accrued revenue is an asset that represents income earned by a deliverer when goods or services are delivered, even though payment has not yet been received.
This guidance, known as ASC 606 (or IFRS 15), aims to improve consistency in recognizing revenue from contracts with customers.
This exception primarily deals with long-term contracts such as constructions (buildings, stadiums, bridges, highways, etc.
Such contracts must allow the builder (seller) to bill the purchaser at various parts of the project (e.g. every 10 miles of road built).
There is a ready market for these products with reasonably assured prices, the units are interchangeable, and selling and distributing does not involve significant costs.