Media accounting: the key IFRS issues

A media company's main assets are stories, recordings, rights and audiences, none of which sit neatly in the standards written for factories and stock. The same film can be an asset on one company's balance sheet, a licence on another's and a source of royalties for a third. This guide maps the key IFRS issues for film, television, streaming, music, publishing and broadcasting, explains why each matters and links to the detailed guides, with notes on where US GAAP has its own entertainment rules.

By Awais Jameel, Chartered Accountant. Reviewed by Muhammad Bilal, Chartered Accountant. 4 minute read.

Short answer

Media accounting under IFRS has no industry standard of its own, so film studios, broadcasters, streaming services, music companies and publishers apply the general standards to unusual assets. Produced and acquired content is usually an intangible asset under IAS 38, or inventory under IAS 2, capitalised at its production or licence cost and amortised in a pattern that reflects how it is consumed, often heavily front-loaded. Content is tested for impairment under IAS 36, individually or as part of a service such as a streaming platform. Revenue from licensing content, royalties, subscriptions and advertising follows IFRS 15, with special rules for licences of intellectual property and royalties based on sales or usage. Sports rights and broadcast licences raise their own timing and useful life questions.

At a glance

Produced content
IAS 38 or IAS 2 at cost
Amortisation
Pattern of consumption, often accelerated
Licensed content
Asset when available for use
Impairment
Title or service level
Licence revenue
Right to use or right to access
Royalties
Recognised as sales or usage occur
Media accounting: the key IFRS issuesProduced content: IAS 38 or IAS 2 at cost; Amortisation: Pattern of consumption, often accelerated; Licensed content: Asset when available for use; Impairment: Title or service level; Licence revenue: Right to use or right to access; Royalties: Recognised as sales or usage occur.KEY FACTS AT A GLANCEMedia accounting: the key IFRS issuesProduced contentIAS 38 or IAS 2 at costAmortisationPattern of consumption,often acceleratedLicensed contentAsset when available foruseImpairmentTitle or service levelLicence revenueRight to use or right toaccessRoyaltiesRecognised as sales orusage occurTax BakersMedia accounting: the key IFRS issuesProduced content: IAS 38 or IAS 2 at cost; Amortisation: Pattern of consumption, often accelerated; Licensed content: Asset when available for use; Impairment: Title or service level; Licence revenue: Right to use or right to access; Royalties: Recognised as sales or usage occur.KEY FACTS AT A GLANCEMedia accounting: the key IFRSissuesProduced contentIAS 38 or IAS 2 at costAmortisationPattern of consumption, often acceleratedLicensed contentAsset when available for useImpairmentTitle or service levelLicence revenueRight to use or right to accessRoyaltiesRecognised as sales or usage occurTax Bakers
Key facts at a glance, as set out in this guide.

Why is media accounting different?

Media companies spend large sums creating or buying content long before it earns anything, and most of its value is used up quickly: a film earns much of its revenue in its first year, and a series attracts most of its viewers soon after release. The same content then earns revenue in many ways, through cinemas, streaming, broadcast, licensing and merchandise, often over decades. IFRS has no standard written for this, so companies use IAS 38, IAS 2, IAS 36 and IFRS 15, and practice varies more than in most industries. US GAAP, by contrast, has specific topics for films, broadcasters and music.

Which IFRS issues matter most in media accounting?

Key media accounting issuesKey media accounting issuesStandardAccountingProduced contentIAS 38, IAS 2Capitaliseat costAmortisationIAS 38Pattern ofconsumptionLicensed contentIAS 38Asset whenavailableImpairmentIAS 36Title orserviceLicence revenueIFRS 15Right to useor accessRoyaltiesIFRS 15As sales orusage occurAdvertisingIFRS 15As advertsare shownSports rightsIAS 38, IFRS 15As eventstake place
Eight issues drive most of a media company's accounting.

How are film and TV production costs treated?

Costs of producing content the company will own and exploit, such as cast, crew, sets and post-production, are capitalised, usually as an intangible asset under IAS 38, or as inventory if the content is made to be sold outright. Development costs are capitalised once a project meets the IAS 38 development criteria and written off if it is abandoned. Marketing and distribution costs are expensed as incurred, and production incentives are usually government grants. See film and TV production costs.

How is content amortised?

IAS 38 requires a method that reflects the pattern in which the content's benefits are consumed. Because viewing and revenue are concentrated early, many companies use accelerated methods based on expected viewing or usage. A method based on revenue is presumed inappropriate under IAS 38 except in narrow cases. Content that earns money only as part of a service, such as a streaming library, is usually tested for impairment as part of that service. See content library amortisation.

When does licensed content become an asset?

Broadcasters and streaming services license much of their content for limited windows. The licence is usually recognised as an asset, with a liability for unpaid fees, when the licence period begins and the content is available for use; before then, the contract is a commitment. Content licences are outside IFRS 16, so they are not leases. See streaming content licences.

How is media revenue recognised?

Licences of content are licences of intellectual property under IFRS 15: a right to use the content as it stands is recognised when the licensee can use it, while royalties based on sales or usage are recognised as the sales or usage occur. Subscriptions are recognised over the subscription period. Advertising is recognised as adverts are shown, with audience guarantees deferring part of the price. See licences under IFRS 15, music royalties and advertising revenue. Related guides cover barter and advertising swaps, subscriptions in publishing and video game revenue.

What about sports rights and broadcast licences?

Multi-year sports rights are usually expensed by the broadcaster as the events are shown, often weighted by the relative value of each event, with payments in advance held as prepayments, while the league recognises the revenue as the matches are played. Broadcast licences bought from regulators or other broadcasters are intangible assets, and those that can be renewed at little cost may have indefinite useful lives. See sports media rights and broadcast licences.

How does US GAAP differ?

US GAAP has specific guidance: ASC 926 for films, ASC 920 for broadcasters and ASC 928 for music. ASC 926 amortises films monetised on their own using the individual-film-forecast method, a ratio of current to total expected revenue, and since ASU 2019-02 content monetised as a group, such as a streaming library, is amortised based on expected use and tested for impairment as a group. IFRS reaches similar answers through general principles, but without the detailed rules.

Need help applying the standards?

Our Chartered Accountants help finance teams and students apply IFRS and US GAAP to real transactions.

Book a call Chat on WhatsApp

Questions people ask

Is there an IFRS standard for media companies?

No. Media companies apply general standards, mainly IAS 38, IAS 2, IAS 36 and IFRS 15; US GAAP has specific topics for films, broadcasters and music.

Are film production costs capitalised under IFRS?

Yes. Costs of producing content the company will own and exploit are capitalised, usually as an intangible asset, while marketing costs are expensed.

How is a content library amortised?

In a pattern that reflects how its benefits are consumed, often an accelerated method based on expected viewing or usage.

Are content licences leases under IFRS 16?

No. Licences of films, video recordings and similar items within IAS 38 are excluded from IFRS 16.

Sources

Every fee, date and rule on this page was taken from these official and primary sources.

  1. IFRS Foundation: IAS 38 Intangible Assets
  2. IFRS Foundation: IFRS 15 Revenue from Contracts with Customers
  3. IFRS Foundation: IAS 36 Impairment of Assets
  4. FASB Accounting Standards Codification: Topic 926, Entertainment: Films

Rules and fees change. If you are reading this long after October 10, 2026, confirm the figures with the source before you rely on them.

MediaFilm and TV production costsMediaContent library amortisationIFRS 15Licences of intellectual property under IFRS 15

More in Media

TopicAll 11 guides in Media

This guide is general information. It is not tax or legal advice for your situation.