CERTYNEX IFRS ACADEMY

Climatiseurs Boréal sells air conditioners with a warranty, not sold separately, that has two parts: an assurance of compliance for 1 year and a technical assistance service for 4 years, which goes beyond that assurance. Climatiseurs Boréal can reasonably account for the two parts separately (case data). What is the appropriate treatment?

The assistance service is a performance obligation receiving a share of the price; the assurance of compliance falls under IAS 37.

Both parts fall under IAS 37, because the warranty cannot be purchased separately.

Each part is a performance obligation, because any warranty longer than 1 year is a distinct service.

The two parts must form a single performance obligation, because they appear in the same commercial warranty.