IFRS 15Chapter 11Lesson 4
Licences of intellectual property: right to access or right to use
Step 1 of 8Learning objectives
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A licence gives the customer rights to the entity's intellectual property. After checking that it is distinct, the entity determines whether it grants a right to access intellectual property that evolves (revenue over time) or a right to use intellectual property as it stands (revenue at a point in time). Sales-based or usage-based royalties follow an exception: revenue at the later of two events.
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Learning objectives
- Determine whether a licence is distinct or forms a single performance obligation with other goods or services.
- Classify a distinct licence as a right to access or a right to use by means of the three criteria, disregarding its attributes.
- Determine the timing or pattern of recognition of licence revenue.
- Apply the sales-based or usage-based royalty exception and calculate the revenue from a franchise.