CERTYNEX IFRS ACADEMY

In 20X1, the Tessin group acquires Brivo in a business combination; the Brivo brand is recognised at its fair value at the acquisition date, i.e. 1,200,000. In 20X2, Tessin spends 300,000 on advertising campaigns to relaunch the Brivo brand and 200,000 to promote its own Tessin brand, created internally. Which treatment is correct in 20X2?

Add 300,000 to the carrying amount of the Brivo brand and recognise the Tessin brand as an asset at 200,000.

Recognise the 500,000 as an expense; only the Brivo brand is recognised as an asset.

Add 300,000 to the carrying amount of the Brivo brand and recognise 200,000 as an expense.

Derecognise the Brivo brand to align it with the treatment of the Tessin brand and expense everything.