In situations where you provide services over a longer period of time recognizing revenue should be measured and accounted for using the stage of completion method (also named as percentage of completion method). This method allows revenues to be recognized in periods the services are rendered in. 

How would you determine the stage however, or the percentage, depending on how you name the method? Note here that payments and advances collected from your customer usually do not reflect on the proper stage of completion. They come from agreements and as such, are not linked to actual work performed. As you know, the actual work is hugely dependent on real life situations, last minute changes and force majeure.

International Accounting Standards in IAS 18 refer to a number of methods for determining the percentage. Albeit the methods used depend hugely on the type of the service, the transaction itself, in short they could be described as follows:

• Ask how much of the work has been performed from respective people responsible for delivering and rendering the service;
• Measure the services already delivered to date as a percentage of the total services to be performed as per agreement;
• Measuring the qualitative aspect of the service, for an example meters of road already constructed as compared to the total meters;
• Measure the proportion of costs already incurred to date relating to this service as a percentage of the total estimated costs relating to the transaction.

It’s up to you to choose your method, a method that is most relevant to the service you’re rendering to your client. There is no right or wrong answer, but you should keep in mind that the method you opt for should ensure you can measure your revenues reliably. Obviously the inputs used for the method should also be reliable.