Percentage of completion method is the recognition of revenue and expenses by reference to the stage of completion of a contract. Under this method contract revenue is matched with the contract costs incurred in reaching the stage of completion, resulting in the reporting of revenue, expenses and profit which can be attributed to the proportion of work completed.
Percentage of completion method is specifically discussed in IAS 11 Construction Contracts.
Source: Glossary of Terms of IFRSs as at 31 December 2008.