Revenue Recognition Accounting Standards Update (ASU) No. 2014-09, Revenue from Contracts with Customers (Topic 606), became effective for the Company on January 1, 2018. The Companys revenue recognition disclosure reflects its updated accounting policies that are affected by this new standard. The Company applied the modified retrospective transition method for open contracts for the implementation of Topic 606. The Company made no adjustments to its previously-reported total revenues, as those periods continue to be presented in accordance with its historical accounting practices under Topic 605, Revenue Recognition . The Company generally has two revenue sources: installation contracts and sales of lighting products. The installation contracts are short term in duration, typically within a week. The disaggregation of revenue for the year ended December 31, 2018 was $1,338,897 and $113,256 for installation contracts and sale of lighting products, respectively. The Company recognizes revenue when it satisfies a performance obligation by transferring control over a product to a customer. Revenue is measured based on the consideration the Company expects to receive in exchange for those products. In instances where final acceptance of the product is specified by the customer, revenue is deferred until all acceptance criteria have been met. Revenues are recognized under Topic 606 in a manner that reasonably reflects the delivery of the Companys products and services to customers in return for expected consideration and includes the following elements:  executed contracts with the Companys customers that it believes are legally enforceable;  identification of performance obligations in the respective contract;  determination of the transaction price for each performance obligation in the respective contract;  allocation the transaction price to each performance obligation; and  recognition of revenue only when the Company satisfies each performance obligation. Performance Obligations The Companys revenue streams can be categorized into the following performance obligations and recognition patterns:  Completion and delivery of installation contracts. The Company recognizes revenue at a point in time when control transfers to the customer, usually through a written customer acceptance form.  Delivery of lighting products. The Company recognizes revenue at the point of shipment to the customer. Transaction prices for performance obligations are explicitly outlined in relevant agreements, therefore, the Company does not believe that significant judgments are required with respect to the determination of the transaction price. When Znergy receives an order from a customer, either verbally or through a written purchase order for products such as individual lights or fixtures, but is not part of an installation contract, the Company recognizes the revenue when the goods are shipped, and title has passed to the customer. In these arrangements, the Company has determined that there is one performance obligation and that revenue should be recognized at the point in time that title passes to the customer. Installation contract revenue is recognized when the contract is considered complete by the customer, through a written customer acceptance form. Each contract for installation of lighting and fixtures, consists of labor and materials, and is given a unique number in the system. Each contract is accounted for individually. The Company identifies the performance obligations, which include labor and materials and are accounted for as one contract. The transaction price is identified in advance with an agreed proposal between the Company and the customer and the price can be adjusted if, during the installation process, changes are made during the process. Under this method, contract costs are accumulated as deferred assets and billings and/or cash receipts are recorded to a deferred revenue liability account during the contract period, but no revenues, costs, or profits are recognized in operations until the completion of the contract. Costs include direct material, direct labor, subcontract labor, and allocable indirect costs. All unallocated indirect costs and corporate general and administrative costs are charged in the periods as incurred. However, in the event a loss on a contract is foreseen, the Company will recognize the loss when such loss is determined. A contract is considered complete when accepted by the customer that the Company has satisfied its performance obligations. There were no contracts which were not complete as of December 31, 2018. Rebate revenue is recognized when the rebate is received by the Company.