IBERSOL | Annual Report 2020

Consolidated Financial Statements Contingent assets are not recognized in the Company’s financial statements but are disclosed in these Notes to the Financial Statements when it is probable that there will be a future economic benefit. 2.18 RECOGNISING REVENUE Revenue is measured at the amount that the entity expects to be entitled to receive under the contract entered into with the customer. The revenue recognition model is based on five steps of analysis, in order to deter- mine when the revenue should be recognized and the amount to be recognized: 1) Identify the contract with the customer; 2) Identification of performance obligations; 3) Determine the transaction price; 4) Allocate the transaction price; and 5) Recognition of revenue. Revenue is recognized only when the performance obligation is satisfied, which de- pends on whether the performance obligations are met over time or whether, on the contrary, control over the good or service is transferred to the customer in a given time. Revenue is recognized as follows: a) Sale of goods - retail In most of the Group’s sales of goods, there is only one performance obligation, so revenue is recognized immediately, with the delivery of the goods to the customer. A performance obligation corresponds to a commitment to deliver goods or services to customers that are different between. When evaluating contracts with customers in which a third party is involved, namely at the level of deliverers (home delivery), the Group assesses its relationship be- tween agent and principal, having concluded that with regard to the obligation of performance of delivery of the goods, it acts as an agent, since this performance obligation belongs to the respective aggregators, and in relation to the performance obligation for the sale of goods, Ibersol acts as the principal and the aggregators with an agent, since Ibersol is responsible for its production and manufacture. 2.19 RIGHT OF USE AND LEASES LIABILITIES A lease is defined as a contract or part of a contract that conveys the right to use an asset for a certain period, in exchange for a fee. 328