A radio station acquires a broadcasting licence granted for ten years by the regulator. The licence can be renewed with no limit at a low administrative cost; the regulator has always renewed it for operators meeting their obligations, and the station intends to keep it and has the means to meet those obligations. Its transmission equipment should be replaced in six years, with no effect on the right to broadcast. The finance director proposes amortising the licence over six years. Write a judgement memo on the useful life of the licence.
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