Accounting Standard of Turkey 11 the accounting, reporting and the application of the construction covenant operations within the scope of construction contracts

ACCOUNTING STANDARD OF TURKEY 11 THE ACCOUNTING, REPORTING AND THE APPLICATION OF THE CONSTRUCTION COVENANT OPERATIONS WITHIN THE SCOPE OF CONSTRUCTION CONTRACTS For the construction companies, determining the period profit or loss and the costs accurately in the long-term construction contracts and transferring them into their respective accounting years are very important. The method used for recognition of the long-term construction contracts in our country is the completion method. This method requires that the construction work is completed to find out the profit or loss, income and cost of the construction work. The profit or loss becomes evident after the work has been completed. The completion percentage method that another method on the other hand is the method accepted by the Turkish Accounting Standard 11 Construction Contracts. The completion percentage method manifests that different accounting periods are created by a construction work when it begins as a long-term project and thus the matching principle must be observed. During recognition in this method, the incomes and costs are recorded based on the completion percentage of the work and transferred into their respective accounting periods when they were realized. Thus, the financial statements are reliable, and it is ensured that the users of such statements can access more accurate and reliable information. Key Words: 1. Construction 2. Construction Accounting 3. Construction Contracts 4. Recognition 5. Reporting.