Revenue Recognition Accounting Policy

Sales are recognized when revenue is realized or realizable and has been earned. Revenue transactions represent sales of inventory. The revenue recorded is presented net of sales and other taxes Procter & Gamble collects on behalf of governmental authorities. The revenue includes shipping and handling costs, which generally are included in the list price to the customer. Procter & Gamble's policy is to recognize revenue when title to the product, ownership and risk of loss transfer to the customer, which can be on the date of shipment or the date of receipt by the customer. A provision for payment discounts and product return allowances is recorded as a reduction of sales in the same period that the revenue is recognized.

Trade promotions, consisting primarily of customer pricing allowances, merchandising funds and consumer coupons, are offered through various programs to customers and consumers. Sales are recorded net of trade promotion spending, which is recognized as incurred, generally at the time of the sale. Most of these arrangements have terms of approximately one year. Accruals for expected payouts under these programs are included as accrued marketing and promotion in the accrued and other liabilities line item in the Consolidated Balance Sheets.

Source: Procter & Gamble Co., Annual Report


Revenues as Reported

Procter & Gamble Co., Income Statement, Revenues

USD $ in millions

12 months ended Jun 30, 2013 Jun 30, 2012 Jun 30, 2011 Jun 30, 2010 Jun 30, 2009 Jun 30, 2008
Beauty 19,956  20,318  19,937  19,258  18,789  19,515 
Grooming 8,038  8,339  8,245  7,864  7,543  8,254 
Health Care 12,830  12,421  12,033  11,493  13,623  14,578 
Snacks and Pet Care 3,156  3,135  3,114  4,852 
Fabric Care and Home Care 27,448  27,254  24,837  23,805  23,186  23,831 
Baby Care and Family Care 16,790  16,493  15,606  14,736  14,103  13,898 
Corporate (895) (1,145) (1,255) (1,353) (1,329) (1,425)
Net sales 84,167  83,680  82,559  78,938  79,029  83,503 

Source: Procter & Gamble Co. Annual Reports

Item Description The company
Net sales Aggregate revenue recognized during the period (derived from goods sold, services rendered, insurance premiums, or other activities that constitute an entity's earning process). For financial services companies, also includes investment and interest income, and sales and trading gains. Procter & Gamble Co.'s net sales increased from 2011 to 2012 and from 2012 to 2013.