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This course is dedicated to Step Two of the revenue recognition model “Identify Performance Obligations”.  Previous courses have outlined each of the individual five steps of the model and provided case examples.  We have also developed two broad case study courses that cover scenario examples for each of the five steps.

In order to focus directly on aspects within each step, we are creating individual courses with multiple case scenarios that apply to the individual given steps.  This course applies to Step Two – Identify Performance Obligations.  The course includes the many considerations companies must take into account when identifying how many performance obligations may exist.  We review the concepts of distinct vs. non-distinct goods and services as well as goods and services that are distinct within the context of the contract.  We also discuss the concept of a performance obligation representing a material offer and how that should be accounted for. 

After taking this course, you should be able to effectively apply your understanding of Step Two of the revenue recognition model to specific scenarios within your business.  Each learning objective listed utilizes multiple examples from various industries to help interpret and practice the concept.

Note: Information within this course comes from readily available public domain documents and is utilized by the trainer as a supplement for relaying the course content.

Resources Consulted:
• ASC 606-10-32-15 to 32-20, 55-244 to 55-246.
• ASU 2014-09: “Revenue from Contracts with Customers.” BC229-BC247.
• Croner-I, “A14 Revenue from Contracts with Customers.” (2019). Section 7.4.2-2 and 7.4.2-2.
• FASB, ”Revenue Recognition Implementation Q&As.” January 2020). Questions 31-37.
• FASB TRG Memo 20: “Significant Financing Components.” 26 January 2015.
• FASB TRG Memo 30: “Significant Financing Components.” 30 March 2015.
• EY, Financial Reporting Developments: “Revenue from contracts with customers.”January 2020. Section 5.5.
• KPMG, Handbook: “Revenue Recognition.”December 2019. Section 5.5.
• PWC, “Revenue from contracts with customers”March 2020. Section 4.4.

Learning Objectives
  • Explore requirements behind step two of the revenue recognition standard “Identify Performance Obligations".
  • Identify differentiation between distinct and non-distinct goods/ services.
  • Explore examples of both distinct and non-distinct goods/services.
  • Identify performance obligations (PO) for the following scenarios:
    • Distinct goods/services
    • Non-distinct goods/services
    • Intellectual property
    • Bundled goods/services  
Last updated/reviewed: August 6, 2023

Included In Certifications

This course is included in the following Certification Programs:

17 CoursesRevenue Recognition Certification

  1. Revenue Recognition (ASC Topic 606) Standard Overview
  2. Revenue Recognition (ASC Topic 606): Identify The Contract Part 1
  3. Revenue Recognition (ASC Topic 606): Identify The Contract Part 2
  4. Revenue Recognition (ASC Topic 606): Performance Obligations Part 1
  5. Revenue Recognition (ASC Topic 606): Performance Obligations Part 2
  6. Revenue Recognition (ASC Topic 606): Transaction Price Part 1
  7. Revenue Recognition (ASC Topic 606): Transaction Price Part 2
  8. Revenue Recognition (ASC Topic 606): Allocating Transaction Price
  9. Revenue Recognition (ASC Topic 606): Recognize Revenue
  10. Revenue Recognition (ASC Topic 606): Scenarios For Identify The Contract
  11. Revenue Recognition (ASC Topic 606): Scenarios For Performance Obligations
  12. Revenue Recognition (ASC Topic 606): Scenarios For Transaction Price
  13. Revenue Recognition (ASC Topic 606): Scenarios For Transaction Price And Recognize Revenue
  14. Revenue Recognition (ASC Topic 606): Case Scenarios Part 1
  15. Revenue Recognition (ASC Topic 606): Case Scenarios Part 2
  16. Revenue Recognition (ASC Topic 606) COVID Implications
  17. Revenue Recognition (ASC Topic 606): Disclosure Requirements “Contracts with Customers”
21 Reviews (89 ratings)


Anonymous Author
Good course for regular subscription price (not certification price). Benefited from taking all the courses. A lot of repetition could be viewed as reinforcing or redundant depending on how quickly can learn. Would rely on wording on slides more than those spoken, as less technically precise. Now have strong foundation in ASC 606.

Anonymous Author
This course felt a bit redundant. There was some new information but a lot was repetitive and actually made me question what I felt I had already understood. Needed to review the supporting material and instructors on demand course a few times to untangle my thoughts.

Member's Profile
The learning objectives were very well communicated with simple examples! The major agenda items were very easy to navigate. Would definitely recommend to others for reference and review.

Anonymous Author
Another great course from Lynn Fountain with excellent examples, including a variety of industry examples. For those looking for more reality, this is an informative webinar.

Member's Profile
Examples in this course and reiteration of certain concepts and definitions covered in previous sessions really helped with the better understanding and learning.

Member's Profile
good recap or prior courses on performance obligations. I would recommend adding more case studies to make this course complimentary to the more detailed course.

Anonymous Author
This was a tough course, but well worth it! The examples really illustrate how to properly apply the standards to a wide variety of scenarios.

Anonymous Author
In-depth examples provided from various industries, which helps to obtain a solid understanding about identifying performance obligation.

Member's Profile
Great course, excellent examples and a wealth of information is provided through this course. I would highly recommend it.

Member's Profile
This course provided great examples that made it clear to me how to apply distinct / non distinct to my own situation.

Member's Profile
Great course that goes into great detailed examples to help solidify the material being taught

Anonymous Author
considering it a single bundle if the intention is to provide all as one was a bit shocking

Anonymous Author
Its a good revision. Helps us memorize the concepts and understand the topic more clearly.

Anonymous Author
Great examples and very well explained topics . Easy to understand the subject

Anonymous Author
Decent guide to case scenarios for performance obligations. Will be useful.

Member's Profile
Good examples outlining performance obligations which is such a tricky area.

Anonymous Author
Valuable examples that really provide a good review of the concepts.

Anonymous Author
excellent info and examples to help better understand the concepts

Anonymous Author
Great examples were used and the course is explained thoroughly.

Anonymous Author
Really great examples and breakdown of PO. This was helpful.

Anonymous Author
Good look at specific contract types that are less common

Course Complexity: Intermediate

No Advanced Preparation or Prerequisites are needed for this course. However, it is recommended to take the other courses in the series prior to completing this one.

Education Provider Information
Company: Illumeo, Inc., 75 East Santa Clara St., Suite 1215, San Jose, CA 95113
Contact: For more information regarding this course, including complaint and cancellation policies, please contact our offices at (408) 400- 3993 or send an e-mail to .
Instructor for this course
Course Syllabus
  Introduction to Revenue Rec: Case Scenarios for Performance Obligations3:06
  Performance Obligation11:34
  Distinct Good and Services7:47
  Example One: Multiple Performance Obligations10:16
  Example Three: Distinct Goods/Services11:03
  Non-Distinct Goods/Services10:58
  Loyalty Programs6:29
  Determination of Distinct vs. Non-Distinct3:54
  Intellectual Property Revenue 8:15
  Revenue Rec: Case Scenarios for Performance Obligations1:16:09
  Slides: Revenue Rec: Case Scenarios for Performance ObligationsPDF
  Appendix – Process Flow: Identify Performance ObligationsPDF
  Revenue Rec: Case Scenarios for Performance Obligations Glossary/IndexPDF