Accounting for Long-Term Construction Contracts under PFRS 15: Challenges, Practices, and Research Directions

ABSTRACT This literature review examines recent studies on accounting methods for long-term construction contracts under PFRS 15, focusing on revenue recognition practices and their implications. Using Google Scholar, approximately 16,400 articles published between 2022 and 2024 were screened, with 20 studies identified as relevant. Key themes emerging from the review include the application of PFRS 15, transaction cost assessments, pricing and risk allocation, and creative accounting practices affecting financial reporting quality. Gaps were identified in empirical validation of revenue recognition models, especially in developing country contexts, and limited focus on implementation challenges faced by construction firms. This review concludes with a proposed research agenda to address these gaps and enhance practical guidance for accountants, auditors, construction managers, and policymakers seeking to improve revenue recognition practices and ensure faithful financial reporting in the construction sector.