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      Question

      Customer acquisition costs (agent commissions) for

      one-year policies are paid upfront. Can they be capitalized as intangible assets?
      A Yes, as marketing intangible Correct Answer Incorrect Answer
      B Yes, if directly attributable to contract Correct Answer Incorrect Answer
      C No, expense unless specific standards allow DAC (which Ind AS does not) Correct Answer Incorrect Answer
      D Capitalize and amortize over three years Correct Answer Incorrect Answer
      E Recognize as prepaid indefinitely Correct Answer Incorrect Answer

      Solution

      Ind AS has no DAC concept; acquisition costs generally expensed when incurred.

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