The main challenges in this area are whether IP licensing is a clear service and, if so, whether the resulting delivery obligation is met over time or at a given time. Software sales are often done in the form of a license for the use of the software. IFRS 15 contains specific guidelines for licensing agreements. What matters is whether a license gives a part of the license to the customer: if a license is not clear, companies should determine whether the license is a primary or dominant component of the performance commitment (IFRS 15.BC407). In this case, the specific provision for the granting of intellectual property licences should be applied. If the licence is not a primary or dominant component of the delivery obligation, the general criteria for compliance applications apply. IFRS 15 does not contain specific criteria for determining whether a license is a primary or dominant component of performance commitment. However, there is an example that is discussed in IFRS 15.BC414X. PARAGRAPHs IFRS 15.B52-B63 relate to the granting of intellectual property licenses such as (IFRS 15.B52): Most users can work without updates and frankly, I often do so on my website ifrsbox.com. I pay for updates, I just don`t install them often and use older versions, because updates are often confused with other items on the site. In practice, a software provider can provide, during a licensing period, a number of related services, such as. B as maintenance, hosting and updating. It is worth careful consideration of the extent to which the licensed software is operational during the transfer to the customer and the extent to which its subsequent functionality is related to the additional services to be provided by the software manufacturer and depends on the additional services.
This will have an impact on the extent to which the licence and related services are considered related and, therefore, whether revenues from the licence are accounted for on a certain date (at the beginning of the licence term) or during the licence period (during the licence period). Hello Silvia, if the intellectual property license is not related to software such as child care operators, should the above principles apply in the same way? (for example. B to determine whether the seller needs to make changes to study materials, curricula and training guides, etc.) The customer is granted the right to use the software in the existing form when the license is granted. A license confers a right of access to the company`s intellectual property, as it exists throughout the licence period, and the corresponding service obligation is therefore fulfilled over time when the client essentially uses the most recent form of intellectual property during the licence period. This is the case when all the following criteria are met (IFRS 15.B58): You should consider all the observable evidence you have, for example. B the licence renewal price could be good evidence of the stand-alone sale price of the updates.