IDP Education has announced a voluntary shift in its revenue recognition policy for student placement services, aiming for consistent timing across all regions at census date. IDP Education is an international education organisation offering student placement services and English language testing. Under the revised policy, revenue recognition in Australia and the United Kingdom will be deferred, aligning with practices already in place in Canada, the United States, Ireland, and New Zealand. The change takes effect from the 2026 financial year (FY26), with comparative figures for FY25 to be restated where relevant.
According to IDP, this update demonstrates a more unified global strategy, acknowledging that students require more extensive support to arrive at their study destinations and begin their courses. The policy change will increase revenue by $9.2 million and net profit after tax by $5.2 million for FY25. This reflects revenue recognition from the higher-volume FY24 period.
Looking forward to FY26, the company anticipates the change will lead to a reduction of approximately $2 million in both revenue and adjusted EBIT (earnings before interest and taxes). Despite this adjustment, IDP has reaffirmed its adjusted EBIT guidance for FY26, maintaining a range of $115 million to $125 million, which includes the impact of the accounting change.
IDP Education has stated that the updated policy is not expected to have any effect on operating cash flows, capital management strategies, or banking covenants. The company continues to focus on providing support to students throughout their educational journey.
