CERTYNEX IFRS ACADEMY

A board game publisher proposes to amortise the licence for a comic-strip character in proportion to the revenue earned from the games that use it, its sales forecasts being considered reliable. How should this proposal be assessed?

It is acceptable as long as the revenue forecasts are reliable and documented.

A revenue-based method is presumed inappropriate; the presumption is rebutted only in the limited cases set out in the standard.

It is prohibited without exception, whatever the characteristics of the licence.

It is mandatory, because it best matches expenses with the revenue of each period.