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One of the criteria that contracts must meet before an entity applies the revenue standards is that collectibility is probable. While US GAAP and IFRS both use the word "probable," there continues to be a difference in its definition between the two frameworks. Despite different thresholds, as noted in the basis for conclusions, in most situations, an entity will not enter into a contract with a customer if there is significant credit risk without also having protection to ensure it can collect the consideration to which it is entitled. Therefore, we believe there will be limited situations in which a contract would pass the "probable" threshold under IFRS but fail under US GAAP.
Probable is defined in US GAAP as "likely to occur," which is generally considered a 75% threshold.
ASC 606 contains more guidance on accounting for nonrefundable consideration received if a contract fails the collectibility assessment.
IFRS defines probable as "more likely than not," which is greater than 50%.

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