What are the current International Financial Reporting Standards regarding customer loyalty programs (such as frequent flyer points)?
A)They are recognized only in the financial statement notes.
B)They are recognized only when customers redeem their points.
C)They are not explicitly addressed.
D)The current proceeds are to be split between the original transaction and the award
Credits (as unearned revenue).

Question

Quizplus · Accepted Answer

Under IFRS 15, revenue from customer loyalty programs is recognized by allocating a portion of the transaction price to the loyalty points, which are treated as a separate performance obligation. This portion is recognized as unearned revenue until the points are redeemed or expire.

What Are the Current International Financial Reporting Standards Regarding Customer