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The following are some thoughts for management to consider when identifying performance obligations:

 Performance obligations may be explicitly stated in the contract and/or may be implied based on customary business practices.

 Do any of the contracts contain material rights to customers that need to be accounted for as separate performance obligation?

 When identifying performance obligations have immaterial items been omitted? If there are immaterial items, how did management determine those items to be immaterial?

 If transactions with customers involve shipping and handling activities, is management going to assess whether the shipping and handling activities represent a separate performance obligation to the customer?

 Should management elect to not account for shipping and handling activities as separate performance obligations and, if so, has that election been properly disclosed in the notes to the financial statements?

 How does management determine whether a promised good or service is distinct, particularly within the context of the contract?

 If a series of goods or services is provided to a customer, should management treat that series of goods or services as separate performance obligations or should they be treated as a single performance obligation?

 Has management established proper controls over the process used to identify performance obligations?