IDP Education (ASX:IEL) announced a voluntary change to its revenue recognition accounting policy, under which student placement revenue will now be recognised across all jurisdictions at census date.
The change, effective for FY26 reporting with FY25 comparatives restated where appropriate, shifts the timing of revenue recognition in Australia and the UK to align with Canada, the United States, Ireland, and New Zealand.
According to IDP, the updated policy provides a more consistent approach across all markets and reflects the evolving nature of student placement obligations, as students increasingly require additional support to commence their studies.
For FY25, the policy change is expected to increase revenue by $9.2 million and net profit after tax by $5.2 million, while reducing net assets, retained earnings, and equity by $68.8 million due to shorter contract asset periods and retrospective adjustments.
IDP said the change will reduce FY26 revenue and adjusted EBIT by approximately $2 million, but it has reaffirmed its FY26 adjusted EBIT guidance of $115–$125 million.
At the time of reporting, IDP Education's share price was $5.68.