• Hista Windari Universitas Muhammadiyah Sumatera Utara
  • Irfan Irfan Universitas Muhammadiyah Sumatera Utara


Strength in revenue recognition will greatly affect the amount of income presented in the financial statements which affect the amount of profit earned in that period. In recognizing revenue PT. Mitsal Luhur uses the percentage of completion method with a physical approach for long-term projects. This is not in accordance with PSAK No. 34 which causes different points of view in determining the company's profit. This study aims to determine the reasons the company applies this approach and analyze how the application of the percentage of completion method in the recognition of construction revenue is applied by PT. Mitsal Luhur Indonesia and analyze which method is the most appropriate method used by construction companies for long-term projects, especially the calculation of construction income. In writing this research, the author uses a qualitative descriptive type of research. The type of data used is quantitative and qualitative data, while the source of data used is primary data, namely the results of interviews from the company regarding revenue recognition and secondary data in the form of project data of PT. Mitsal Luhur Indonesia in particular the Installation For Equipment TOH Intec project. Data collection techniques used are interview and documentation techniques, which will be analyzed by comparing the methods applied by the company with the cost-to-cost approach to revenue recognition. From the results of research conducted, the results of revenues and profits recognized by the physical approach tend to be higher (overstatement) than the cost-to-cost approach, this is because the physical approach is only based on estimates of physical progress without taking into account the costs that have been incurred in completing the project. So the cost-to-cost approach presents more reasonable income and profit because it is calculated based on the costs incurred so that it can reflect the actual performance of the company and is in accordance with the matching principle and the principle of conservatism in the presentation of financial statements.


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How to Cite
WINDARI, Hista; IRFAN, Irfan. ANALYSIS OF APPLICATION OF PERCENTAGE OF COMPLETION METHOD IN RECOGNITION OF CONSTRUCTION CONTRACT REVENUE (PSAK NO. 34) CASE STUDY AT PT. GREAT MITSAL INDONESIA. International Proceeding of Law and Economic, [S.l.], p. 253-256, july 2022. Available at: <>. Date accessed: 26 sep. 2023.