CERTYNEX IFRS ACADEMY

Lumira, a manufacturer of smoke detectors, enters into thousands of standard contracts with installers every year. It wants to account for these contracts as a portfolio. Under what condition does IFRS 15 permit this?

The contracts must all have been entered into with the same customer.

The portfolio must include a minimum number of contracts set by the standard.

The contracts have similar characteristics and Lumira reasonably expects an effect that does not differ materially from a contract-by-contract analysis.

Use of the portfolio must have been authorised in advance by the auditors.