IFRS 15Chapter 11Lesson 3
Customer options and rights: loyalty, advance payments, unexercised rights, upfront fees
Step 1 of 8Learning objectives
Go deeper+3 deeper insights · +1 calculation · +1 point of attention
When the customer pays today for a future benefit (loyalty points, discount voucher, gift card, joining fee), part of what it pays has not yet been earned. The lesson shows when an option becomes a performance obligation (material right), how to measure it, how to account for an advance payment and for rights the customer will not exercise, and how to spread non-refundable upfront fees.
30 minNot started
Learning objectives
- Distinguish an option that provides a material right (a performance obligation) from a mere marketing offer.
- Estimate the stand-alone selling price of an option, allocate the transaction price and track the release to revenue, including after a revision of estimates.
- Recognise an advance payment as a contract liability and calculate revenue from expected unexercised rights.
- Determine whether non-refundable upfront fees pay for a transferred good or service or are an advance payment for future services.