ACCA SBR December 2026: The IFRS 15 "Distinct" Test That Costs Marks

If an IFRS 15 contract bundles goods and services, don't assume one performance obligation. Apply the "distinct" test first, because it decides when revenue is recognised and it is where SBR candidates drop easy marks.

Why this keeps costing marks

IFRS 15 is a staple of SBR scenarios, and the pattern is familiar: a contract sells several things together, and the question asks how much revenue to recognise and when. Candidates jump straight to the transaction price and skip Step 2 of the five-step model, identifying the performance obligations.

Under IFRS 15, a promised good or service is a separate performance obligation only if it is capable of being distinct and is distinct within the context of the contract. Both limbs matter. Examiners reward the second limb, because it is the one that needs the scenario facts.

Look for the signals in the contract: does the entity provide a significant service of integrating the items, does one item significantly modify another, or are the items highly interdependent? If so, they are likely one combined obligation. If the customer could buy them separately and the entity sells them separately, they are likely distinct.

SBR is a professional-skills paper as well as a technical one. Marks go to applying the criteria to the facts and concluding, not to reciting the five steps. A list of steps with no conclusion scores very little.

Worked example

An entity sells specialised software and a one-year support service for a single price. The support is routine and other vendors could provide it.

Weak answer: "IFRS 15 has five steps. The price is allocated to the performance obligations and revenue is recognised when control passes."

Strong answer: "The software and support are capable of being distinct, since the customer benefits from each on its own. They are also distinct in the contract, because the support does not significantly modify the software. There are therefore two performance obligations. The price is allocated by relative standalone selling price. Software revenue is recognised when control transfers, and support revenue is recognised over the year."

The second answer names the test, applies it to the facts and reaches a conclusion with a consequence for timing.

What to do

1. Write the conclusion first. Open with "this is one obligation" or "these are separate obligations", then justify it with the contract facts.

2. Use the scenario's own words. Quote the integration, customisation or interdependence details from the question. Generic IFRS 15 text earns little.

3. Finish with the timing. Say whether revenue is point in time or over time, and give the reason (control transfer or one of the over-time criteria).

The bottom line

SBR is routinely one of the lower-pass-rate papers in the ACCA exam suite, which is why applying a criterion to a fact pattern separates passes from near-misses. Treat the distinct test as marks you can plan for.

Name the test, apply it, conclude. That is the whole answer.