AASB 15 Revenue from Contracts with Customers B48-B51: Account for non-refundable upfront fees according to whether they relate to a transferred good or service, deferring fees for set-up activities over the expected service period including anticipated renewals

What does B48-B51 require?

Joining, activation and similar upfront fees are examined to see whether any promised good or service transfers with them. Where the fee relates to administrative or set-up activities that transfer nothing, it is a prepayment toward future goods or services, recognised when those are provided, over a period that may extend beyond the initial term when the fee gives the customer a material right on renewal. Set-up costs are assessed under the fulfilment cost rules, and the Standard notes they may be capitalised fulfilment costs if the criteria are met.