www.pwc.com/miag

MIAG

Issue: 8

Media Industry

May 2015

Accounting Group

Making sense of a

complex world

Online gaming: Real

issues in virtual worlds

This paper explores some

of the key IFRS revenue

recognition issues in the

world of online gaming.

Contents

Introduction to MIAG

2

Online gaming: Real issues in virtual worlds 3

Background 4

Example 1: Who is my customer?

8

Example 2: Virtual items and virtual currencies 12

Example 3: Multiple element arrangements 16

Example 4: Unused currency and unused items 18

Conclusion 20

Further reading

22

Contacts 24

Introduction to MIAG

Our Media Industry Accounting Group (MIAG) brings together our specialist media knowledge from across our worldwide network. Our aim is to help our clients by addressing and resolving emerging accounting issues that affect the entertainment and media sector.

With more than 4,200 industry

your thoughts and suggestions about

dedicated professionals, PwC’s global

future topics of debate for the MIAG

entertainment and media (E&M)

forum, and very much look forward to

practice has depth and breadth of

our ongoing conversations.

experience across key industry sectors

including: television, film, advertising, Best wishes

publishing, music, internet, video and

online games, radio, sports, business

information, amusement parks, casino

gaming and more. And just as

significantly, we have aligned our media Sam Tomlinson practice around the issues and

PwC UK

challenges that are of utmost

importance to our clients in these

Chairman

sectors. One such challenge is the

PwC Media Industry Accounting Group

increasing complexity of accounting for transactions and financial reporting of results – complexity that is driven not just by rapidly changing business models but also by imminent changes to the

world of IFRS accounting.

Through MIAG, PwC1 aims to work

together with the E&M industry to

address and resolve emerging

accounting issues affecting this dynamic sector, through publications such as this one, as well as conferences and events to facilitate discussions with your peers. I Sam Tomlinson

would encourage you to contact us with

PwC UK

1 PwC refers to the PwC network and/or one or more of its member firms, each of which is a separate legal entity

2 MIAG Issue: 8

Online gaming: Real issues in virtual worlds

PwC’s Global E&M Outlook 2014-2018 forecast an increase in global spending on video games from €66 billion in 2014 to €89

billion in 2018, with online gaming being one of the key drivers.

Our eighth MIAG paper explores some of the key revenue recognition issues in these virtual worlds.

Video gaming encompasses not only

exhaustive; but they will hopefully

traditional console or PC games, which

provide food for thought for online

have been in existence for over 20 years, gaming companies when considering but also online gaming. The significant the real revenue recognition issues that growth of online gaming is driven partly arise in virtual worlds.

by online players interacting with online friends and rivals, and partly by the rise We hope that you find this paper useful of mobile gaming facilitated by

and welcome your feedback.

increasing penetration of smartphones

and tablets.

Best wishes

The rise of online gaming encompasses

not just expensively-produced

blockbusters but also low-cost mobile

games. The low cost of producing

Wilson Chow

Samying Huie

certain types of games has drastically

PwC China

PwC China

lowered barriers to entry compared with console and PC games, causing the

number of game developers to explode

PwC Media Industry Accounting Group

over the past five years.

New technology platforms and new

entrants have driven new business

models such as ‘freemium’ games that

are free to play but in which real cash must be spent to acquire virtual goods or other premium content. This paper

considers the resulting accounting

challenges in various practical examples covering principal/agent arrangements,

virtual items and virtual currencies, and multiple element arrangements. Our

scenarios are clearly not designed to be Wilson Chow

Samying Huie

PwC China

PwC China

Issue: 8 MIAG 3

Background

PwC’s Media Industry Accounting Group (MIAG) is our premier forum for discussing and resolving emerging accounting issues that affect the entertainment and media sector – visit our dedicated website: www.pwc.com/miag

What are the most common online

games’ (MMOGs), these games are

gaming business models?

characterised by longer playing

Online games can be categorised by how

periods and high game intensity.

they are monetised (i.e. how the game

The gamer makes a significant

enjoyment experience is sold), and by

emotional and/or cognitive

sessions compared to traditional

game type and genre.

investment in the game, and game

MMOGs. One popular type of web

play may last for a few hours per

• Monetisation: Subscription-based games are those social games played

session, with many such sessions.

games are monetised by either a

on social network platforms. Web

These games are typified by the

periodic subscription fee, a download

games typically do not require any

virtual gathering of multiple players

fee or other usage fee. Non-

software installation apart from a

in the same online environment (via

subscription-based games are typically

web browser or sometimes browser

internet connection), with gamers

free to play (‘freemium’) but are

plug-in. Web games are often

often cooperating or competing in

monetised through the sale of virtual

free-to-play but players can choose

the context of an epic adventure or

items or other premium content to the

to purchase virtual items to enhance

thematic experience. MMOGs

game player (‘gamer’). Successful

the game-playing experience (the

typically require dedicated software

monetisation of a freemium game

‘freemium’ model).

to be downloaded through which

involves creating a gaming experience

the game is delivered and played on

– Mobile games – are those games where players are incentivised to spend computer screens of video game

played on smartphones, tablets,

money on virtual items that enhance

consoles. Large multi-player games

PDAs and other mobile devices.

overall enjoyment. A virtual item

can be delivered on a subscription or

They share a lot of the same

represents either the digitisation of a non-subscription basis.

characteristics as web games, such

real-world product (e.g. virtual hat) or as that they include all game genres,

a digital concept with its own meaning

– Web games – also known as

can be single-player or multi-player,

within the game (e.g. power, magic,

browser game, these games are

and appeal to a broader audience.

special ability).

played over the internet via a web

However, mobile games are even

browser, generally on PC. Web

• Game types: Games can be for a single easier to access than web games so

games include all game genres (such

player (solo) against pre-scripted rules people tend to play in even more

as hardcore games, midcore games,

or for multiple players in a world

frequent and shorter sessions. Due

casual games, social games etc.) and

designed to foster collaboration and/or to the limitations of the screen,

can be single-player or multi-player.

competition. The types of online games

mobile games tend to be less

Unlike MMOGs that attract more

can be summarised in many different

complex and include more casual

hardcore players, web games appeal

ways but perhaps most commonly

games and social games. Unlike web

to a wide spectrum of age groups

as follows:

games, mobile games require the

and demographics due to easy and

installation of software known as

– Large multi-player games – often free access. Also, they are often

the application (‘app’). Apps are

termed ‘massive multi-player online

played in more frequent, shorter

generally downloaded by players

4 MIAG Issue: 8

from mobile app stores but

Who have the key roles in delivery?

game maintenance, and providing

sometimes are pre-installed by

Delivery of an online game to paying and customer service functions (e.g. call

mobile carriers and mobile device

non-paying players often involves the

centre, player support, online forum).

makers. Mobile games can be played following roles. These different roles can

• Distribution channels and

both online and offline. The pay-per-

be carried out by different entities or one intermediaries are other parties download model is most common

entity may serve one of more of the roles.

involved in this gaming ecosystem.

but subscription-based and

For mobile and some web games, the

freemium model are also becoming

• Game developers combine

distribution channel might be the

more popular. With the

programmers, graphic artists and

publisher. These intermediaries

development of cross-platform

other specialists to develop the code

include:

delivery of content, publishers are

and intellectual property (IP)

increasingly delivering a seamless

underlying a game. Game developers

– Storefronts such as the Apple App

connection between web games and

may be involved in post-release game

Store, Google Play or Amazon

mobile games. Gamers are able to

upgrade, maintenance, and bug-fixing

Appstore (for Android) are

play their chosen games on both

activities. Game development used to

distribution channels that have

their computers and their

be mostly an in-house function of a

direct access to end users;

mobile devices.

fully integrated gaming company that

– Other delivery intermediaries

also markets, distributes, operates

• Game genres: Within both single –

providing e.g. IT infrastructure;

games and supports game customers.

and multi-player online games there

social websites; and online portals

Today, there are more and more

are numerous genres including action,

and other commercial websites that

studios and individuals focused

sports, mystery, fantasy, adventures,

allow access to the game; and

exclusively on game development.

science fiction, and so on. Often, the

– Payment intermediaries that

game environment is adapted from a

• Game publishers release the game facilitate payment transactions

popular trademark (brand), book or

code by selling DVDs or making the

between a gamer and another party.

movie with the right to use such

game available for access on the

These include credit card payment

intellectual property licensed from

internet or storefronts. Game

processors, distributors of prepaid

another party.

publishers may use their own IT

cards or online payment service

infrastructure connected to the

providers such as Paypal. Payment

internet, or they may use a delivery

functions can also be provided by

intermediary. Game publishers may

storefronts and delivery

also be responsible for marketing,

intermediaries.

Issue: 8 MIAG 5

The arrangements will be different for

publishing platforms built by mobile

should be applied to the transaction as different types of games. Operations in game publishers on the strength of their a single unit. Conversely, if the

different terrorities may also differ. For products and user base. These platforms customer perceives there to be a

example, in traditional MMOGs, there are offer functions including publishing,

number of elements to the transaction,

typically only two main parties involved promotion, operation, social connectivity then the revenue recognition criteria

in providing game service to end users.

and account management to game

should be applied to each element

Game developers focus on research and

developers. These trends are

separately.

development as well as the creation and transforming the distribution and

upgrade of the games. Game publishers

consumption of online games.

• Apply the revenue recognition

license the games from the developers

criteria to each element (or to the and are responsible for distribution,

What is the relevant IFRS

transaction as a whole) – revenue is

marketing and operations of the games.

guidance?

recognised when (i) it is probable that Occasionally, the publisher and the

IAS 18

economic benefits will flow to the

Revenue recognition does not

developer is the same company. However, provide industry-specific guidance and

seller; (ii) revenues and costs can be

the operation of a web game or mobile

indeed was written long before online

measured reliably; and (iii) the risks

game generally involves more parties. In gaming even existed as a concept! A

and rewards of ownership have been

addition to game developers and

general approach to revenue recognition transferred with minimal ongoing

publishers, mobile app stores, mobile

for online gaming companies is

involvement (for sale of goods) or the

carriers, social networks, and online

as follows:

stage of completion can be measured

portals might also be involved. Or the

reliably (for provision of services).

mobile game developer may launch its

• Determine who the customer is

For the gaming industry, two models

game directly on Apple’s App Store. The

– this helps to determine whether

generally emerge:

role of each party might vary significantly revenue is recognised gross (as a

depending on specific arrangements.

principal) or net (as an agent) and

• Gaming as software: e.g. traditional what the company’s obligations are to

packaged console and PC games, for

The online gaming industry is currently its customer.

which the company is selling software.

undergoing dramatic change driven by

• Determine if the transaction is one

• Gaming as service: this model

significant technology and consumer

unit or comprises multiple elements

encompasses online or hosted games

trends including (1) rapid growth of

– the transaction should generally be

where the operational business model

mobile platforms, (2) social networks as viewed from the perspective of the

is the delivery of the game as a

an integral part of the entertainment

customer and not the seller i.e. what

service, regardless of whether

fabric, and (3) mobile platforms and

does the customer believe he or she is

accessed by PC, console, or mobile

social networks opening their platforms purchasing? If the customer views the

device. It is this type of gaming that is to developers. There is also an

purchase as one product, then it is

explored in the subsequent scenarios

emergence of independent mobile game

likely that the recognition criteria

in this paper.

6 MIAG Issue: 8

This paper considers the resulting

for accounting periods beginning on or

often follow accounting revenues. So

accounting challenges in various

after 1 January 2017 (or 2018) with

judgements about revenue recognition in practical examples covering principal/

earlier adoption permitted. Transition to online gaming scenarios can affect the

agent arrangements, virtual items and

IFRS 15 will require companies to review timing of tax cash payments.

virtual currencies, and multiple

all sales arrangements closely, which in element arrangements. Our scenarios

practice might result in media companies Some countries may have tax legislation are clearly not designed to be

needing to revisit historical policies and specifically designed to address online exhaustive; but they will hopefully

judgements even where there is not an

gaming, in which case the accounting

provide food for thought for online

obvious difference between IAS 18 and

treatment adopted should in theory be

gaming companies when considering

IFRS 15. Even if a company expects

tax neutral. However, even in such

the real revenue recognition issues that revenue recognition to be similar under countries, the accounting treatment

arise in virtual worlds. As business

IFRS 15 to its existing practice under IAS

adopted might have implications with

models continue to develop, other

18, it cannot simply assume that this will regards to corporation tax and sales tax, issues might become increasingly

be the case. IFRS 15 is a fundamentally since differing treatments for accounting important for this industry, such as

different model to the current revenue

and tax purposes might raise the

attention of local tax authorities or

appropriate recognition of ‘in-game’

guidance and even where revenue

accounting regulators. Tax authorities

advertising revenue, the timing of cost recognition is unchanged, the rationale might also pay close attention to sales to, recognition and broader principal/

might be different. We expect practice to or distribution by, related group

agent issues. As always, the answer

develop quickly over the coming months

companies to understand the substance

for complicated real life arrangements

and recommend that companies consult

of intra-group transactions.

will depend on specific facts and

with their accounting advisors as they

circumstances.

work through their transition projects.

We would always recommend consulting

with a local tax expert to determine

What about IFRS 15?

Are there any tax implications?

possible tax consequences of revenue

This paper focuses primarily on the

This paper is concerned primarily with

recognition judgements.

revenue recognition challenges that

accounting, which should be consistent

online gaming companies face today.

across companies reporting under IFRS,

However, for each scenario, we have also rather than tax, which will vary with

included relevant considerations under

each country’s local laws and tax

the new revenue recognition standard

regulations. We note that both

IFRS 15, which is expected to be effective corporation (income) tax and sales tax Issue: 8 MIAG 7

Example 1: Who is my customer?

“As a game publisher, all my income

ultimately derives from gamers. But are these gamers my customers?”

In example 1 we consider what the game

amount paid to the distribution

company is responsible for the

publisher is selling and who it is selling channel (the expense instead being

acceptability of the products or

to. As set out below, this assessment is presented as a cost) if the publisher

services or has the most influence on

key, as the measurement of revenue

has significant latitude over the

their content.

could be significantly different

relationships with distribution

• The company has inventory risk

dependent on who the game publisher

channels and responsibility for the

before or after the customer order,

identifies as its customer. For example, transactions with them.

during shipping or on return – for identifying the customer can be

Another possibility (perhaps less

this indicator the general sales risk of important when assessing whether

common) is that the game publisher’s

the developed good could also be

payments made or discounts given to

customer is the distribution channel.

considered i.e. who bears the greater

either the developer or the gamers are

This might be the case where the

risk from the investment in content

the publisher’s marketing costs or

distribution channel is acting principal and distribution.

revenue deductions.

selling to the ultimate gamer and the

• The company has latitude in

publisher sells game software or

Complex gaming arrangements –

establishing prices – this might be provides a game service to the channel.

involving a game developer; publisher;

the case if the company sets the sales

distribution channel (e.g. internet portal price or has the ability to set prices

In certain situations, the publisher might or platform provider or internet store); within a broad range. An agent is

also need to consider whether it is

and gamer – typically require the game

more likely to have earnings that are

actually an intermediary between the

publisher to assess whether it is

predetermined via a fixed fee per

developer and the ultimate gamers and

functioning as:

transaction or a stated percentage of

in fact has two customers because its

the amount billed to the customer.

• A principal selling directly to

efforts benefit both the developer and

ultimate gamers, using the internet the ultimate gamer. This is sometimes

• The company bears the customer’s

portal or store as its agent, in which

known as the ‘dual customer’ model.

credit risk for the amount

case the game publisher would

receivable from the customer – this recognise as revenue the gross amount A company is acting as principal when it

‘traditional’ risk might be mitigated by paid by the gamers, with the amount

has exposure to the significant risks and up-front electronic payment.

paid to the developer and portal/store

rewards associated with selling goods or These indicators are not exhaustive; nor representing a cost of sales; or

rendering services. In contrast, a

must all of them have been met to

company that acts on behalf of another

• A sales agent acting on behalf of the confirm that a company is acting as

party realises revenues by receiving

game developer, i.e. its customer is principal. In practice, some indicators commissions or fees, because it is acting really the developer so it recognises as might suggest that one party is

as an agent. The illustrative examples

revenues only the net amounts

principal, while other indicators suggest attached to IAS 18 set out some

retained after deducting directly

the reverse. Relevant indicators are

indicators to consider when assessing

related payments; it is worth noting

therefore considered as a whole to assess potential principal/agent arrangements.

that the ‘net revenue’ recognised

the economic substance of the

Indicators that a company should

might either (i) include a deduction

arrangement, with the greater weight

account for a transaction as principal

for the amount paid to the distribution being assigned to the most important. In include:

channel, if the publisher’s transactions some cases a small change in the

with the distribution channel are

• The company has the primary

relevant contractual terms or business

closely directed by the game developer

responsibility for providing the

practice can affect the principal/agent or (ii) not include a deduction for the goods or services to the customer

assessment.

or for fulfilling of the order – i.e. the

8 MIAG Issue: 8

Scenario

How should game publisher P

Game publisher P’s net profit under each Game publisher P obtains from overseas

account for its sales?

treatment is €5.

game developer D an exclusive licence to Game publisher P must decide who its operate a MMOG in P’s country by

customer is. That is, whether it is

(Note: If P is the intermediary agent

paying an up-front licence fee and a

acting as:

acting on behalf of both developer D and sales-based royalty.

the gamers by bringing them together in

• Principal selling the game to ultimate the ‘dual customer’ model, the analysis gamers, using channel C as its sales

Publisher P is responsible for arranging would be similar to the second

agents i.e. record gross revenues of

IT infrastructure, internet connections, treatment above where P is acting as an

€10 received from gamers with €5

deciding the game price in the country’s agent on behalf of the developer.

costs comprising €3 to developer D

local currency, and providing customer

However, identifying the customer as

and €2 to channel C; or

service to domestic gamers. Publisher P

developer D alone, or both D and

promotes itself as the operator of the

• Sales agent acting on behalf of

ultimate gamers, may have other

game and enters into agreements with

developer D i.e. record net revenues of accounting consequences e.g. (i) gamers accordingly.

(i) €7 retained from gamers after

whether gamer incentives are presented

deducting amounts paid to developer

as a cost or revenue deduction; and (ii) Publisher P also pays distribution channel D with costs of €2 paid to channel C;

determining P’s explicit and implicit

C (e.g. an internet portal or app store) a or (ii) €5 if P is not taking overall

obligations to the ‘customer’.)

fixed price per game sold to make

responsibility for the services

available the game for sale as well as an provided via channel C; or

agreed amount of banner advertisements.

• Principal selling to channel C,

Channel C collects cash from the gamers recording as revenue the €8 it receives and remits that cash, net of the fixed fee, from channel C with costs of €3 paid

back to publisher P. Gamers click through to developer D.

to P’s infrastructure from channel C to download the game.

P sets the price of the game at €10; and P

pays €3 to D as a sales-based royalty and

€2 to channel C for each game sold.

IT and customer service

Game code

(via channel C)

Game

Game

developer D

publisher P

Gamer

Non-refundable

Cash

licence plus royalty

(via channel C)

Issue: 8 MIAG 9

Assessment of key principal/agent indicators

The ultimate sale is to the gamer and the remitted directly to game publisher P.

Publisher P considers four key indicators gross payment of €10 is received from

P receives €8, from distribution

to establish whether or not the gamer is the gamer. But the gross amount is not

channel C, net of the channel’s fee.

publisher P’s customer:

Indicator

Assessment by game publisher P

Primary

• The gamer visits channel C (e.g. internet portal or app store) and might consider that he or she pays responsibility for

channel C for the game

providing the

• The gamer might be aware of who originally developed the game goods and services • However, P appears to be the primary obligor to gamers in that it clearly markets itself as the game operator and this is reflected in its contracts with gamers

• Further, P is responsible for IT infrastructure, internet connections, and customer service

• Indicates game publisher P (rather than developer D or channel C) is acting as principal selling to gamers

Inventory risk

• There is no traditional inventory risk for online gaming since there is no physical product

• It may be considered that publisher P takes something akin to inventory risk by paying developer D a non-refundable initial licence fee

• It seems likely that D takes the most significant risk given its historical investment to develop the game, although that investment is not specific to sales in this country

• Both D and P take some risk here (which might be considered analogous to inventory risk) and as such, this indicator is mixed

Latitude in

• Publisher P sets the price charged to gamers establishing prices

• P’s revenues are not predetermined i.e. P can vary prices to drive sales volumes

• Both developer D and channel C receive a fixed amount per sale

• Indicates game publisher P is acting as principal selling to gamers Credit risk

• Online gaming is generally paid by credit card and the distribution channel would typically obtain authorisation for the charge prior to completing transactions

• Credit risk is therefore largely mitigated

• Lack of substantive credit risk means this indicator unlikely to be determinative

Conclusions

The principal/agent indicators suggest However, even if publisher P were to reconsider its determination that it is that game publisher P is acting as

give some pricing latitude to channel C, acting as a principal because the

principal in selling the game to

it might still be principal based on the channel appears has significant

gamers. P would therefore record

other indicators. Occasionally, game

pricing latitude. These judgements

gross revenues of €10 received from

publishers that use distribution channels can be difficult and must be made in gamers with €5 costs, comprising €3

do not have visibility of the exact final light of all available facts and

to developer D and €2 to channel C.

selling price. In such cases, the game

circumstances, considering all the

publisher should make its best estimate indicators and not just who sets

Of course, alterations of this scenario’s of the price paid by gamers, so that it selling price.

fact pattern could result in different

can recognise that amount as revenue

conclusions.

with the difference between that gross

For mobile games, in many cases

amount and the cash it receives treated publisher P may actually be an

For example, if channel C had the

as cost of sales (the channel’s

internet portal, which provides access

power to determine the price charged

commission). If the publisher believes it to many different casual game titles

to gamers and paid a fixed amount per cannot make a reasonable estimate of (i.e. the role of publisher P and

game to publisher P, then the

the price paid by gamers, it should

distribution channel C are combined).

conclusion might be that P is selling to consider the reasons for this. If the range Where P makes clear to gamers that it C. P would then record net revenues of of prices open to the channel is is acting as the sales and payment

€8 received from C, with separate

sufficiently broad that an accurate

intermediary, and that developer D

costs of €3 paid to developer D.

estimate is difficult, the publisher should

10 MIAG Issue: 8

has ultimate responsibility to the required to make its own assessment of

game code services to the publisher

gamers, P should be recording

whether it was selling to publisher P, to for it to sell to gamers. The

revenue on a net basis. As noted

channel C, or direct to gamers.

agreement should also make it clear

above, this might be the case even if P

who sets prices, maintains user

has some latitude to set the

Factors that can help inform these

accounts and provides IT

selling price.

judgements by the game publisher and

infrastructure.

developer include:

• Business practices: is the game Alternatively, developer D might be

available via multiple channels, or

marketing the game under its own

• Agreements with gamers: which

exclusive to one? If either the

brand, providing IT infrastructure

company (developer or publisher or

publisher or channel has an

and customer support, setting the

channel) presents the gamers with

exclusive right to operate in a

prices charged to gamers, but uses

their terms and conditions; and which

particular territory, the gamers

publisher P to administer the game

of them has ultimate responsibility,

might view that exclusive provider

locally (via approved distribution

legally or otherwise, to gamers if

as the primary obligor as opposed to

channels) by drawing up relevant

game service is not properly provided?

a situation where the same game

contracts, acting with gamers and

• Cooperation agreements between

appears via many channels. Which

channels on its behalf and collecting

game developers, publishers, and

company name does the gamer see

and disbursing cash. In this case

channels: do the agreements indicate when he logs on? And who is

publisher P might be acting as an

a clear service provider? For example,

responsible for customer service to

agent for developer D.

some agreements might indicate that

gamers? What do the marketing

the channel is supplying payment

materials and the game’s website

In this example we focused on game

processing services to the game

indicate?

publisher P’s perspective but game

publisher, while others may indicate

developer D would of course also be

that the game developer is providing

Considerations under IFRS 15

• Inventory risk: who has inventory risk revenue when its agent has some pricing IFRS 15 is a control based model under

in the transaction?

discretion (the ‘dual customer’ model).

which a company is now defined as

The TRG’s discussions highlighted that

• Pricing: who has discretion in

principal if it obtains control of the

application of the IFRS 15 guidance in

establishing prices?

goods or services of another party in

this area is not straightforward,

advance of transferring control of those

• Credit risk: who has customer

especially in the context of online

goods or services to a customer.

credit risk?

transactions. The TRG recommended

Conversely, a company is an agent if its that the IASB and FASB discuss this

• Commission: is consideration in the

performance obligation is to arrange for issue at a future meeting. It might be

form of a commission?

another party to provide the goods or

that the IASB and FASB decide to

services. These criteria can be

Although the indicators are broadly

provide further clarification on this

contrasted to the previous ‘risk and

unchanged, transfer of control is not

topic, although at the time of this

reward’ model described above.

necessarily equivalent to transfer of

publication, it is currently not clear

risks and rewards so close review of

whether any further guidance will be

The nature of a company’s obligation is sales arrangements might result in

provided and, if it is, when that

not always clear and so IFRS 15

revised principal/agent conclusions.

would be.

provides indicators to help companies

decide whether or not a good or service It is worth noting that the application of is controlled before it is transferred.

the new principal/agent guidance in

These are broadly unchanged from the

IFRS 15 was discussed at the July 2014

principal/agent indicators included in

meeting of the Transition Resource

IAS 18:

Group (TRG), which informs the IASB

and the FASB of any issues arising with

• Fulfilment: who zhas primary

implementation of the new standard.

responsibility for fulfilment of the

The TRG was also asked to consider

contract?

‘’how a principal should recognise

Issue: 8 MIAG 11

Example 2: Virtual items and virtual currencies

“How long does a digital energy drink last? What about a digital sword?”

In example 2 we consider the challenging

What are some common types of

It is not always straightforward to fit a question of when a company has fulfilled

virtual items and the associated

virtual item into the above categories.

its obligation, so that it is entitled to

revenue recognition?

For example, players may purchase a

recognise revenue for virtual items. It is virtual cow for their farm that can

clear that the sale of virtual items can be

• Consumable items are consumed

reproduce virtual calves that can be

viewed differently from the sale of

virtually for immediate or near-

gifted to friends or kept in the farm; the physical goods. For example, after the sale immediate gratification. For example,

cow might also produce virtual milk that of a physical red hat to a customer, the a virtual ice cream can only be

players can give to friends or use in their retailer will usually have no further

consumed once; a virtual bundle of

virtual restaurant to make ice cream.

obligations to the customer. When a

three non-reusable arrows is fully

The game company should look at the

virtual hat is sold to a gamer, he or she can consumed after the third arrow is

underlying substance by focusing on the only benefit by wearing the hat in a digital shot. Consumption might take place

period over which the gamer enjoys the

environment that must be maintained by

immediately on purchase or there

benefits of that virtual good or its direct the game publisher (or developer). In this could be a short ‘consumption

derivatives.

example we assume the company is the

window’ between purchase and

principal in selling to the gamer.

expiry. Revenue should generally be

How is the delivery period

recognised as these items

determined?

Although payments made by gamers are

are consumed.

If possible, the delivery period should be generally non-refundable and the

estimated at the item level (or grouping publisher might legally be able to

• Periodic items are consumed over a of similar items) and revenue recognised terminate game operation without any

specified duration or period of time.

over that period. But publishers may

penalty, game publishers typically have an For example, a virtual vial of magic

have millions of virtual items spread

implied obligation to maintain the digital power once purchased/consumed may across many thousands of users so game environment that enables the

last for only 90 days. Revenue should

keeping track individually might be cost virtual items to be used. This implicit generally be recognised rateably over

prohibitive or impossible. Publishers

obligation is created by the game

the period in which gamers enjoy

might therefore need to estimate the

publisher’s intention to continue its online access to, or benefit from, these items.

average consumption period based on

game business and supporting operations. • Durable (or permanent) items are the nature of the item(s) and the game.

Accordingly, revenue should be recognised made available to gamers over a

over the period of the implied obligation longer period of time, often for as long This can be complex: for example, a (the ‘delivery period’) for those virtual as the user continues to play the game. virtual sword might be technically a items that provide prolonged utility or For example, a virtual sword can be

permanent item, but with a shorter

enjoyment to the gamer.

used as long as the user plays the

consumption period if the game

game. Revenue from these items

(The rest of this example focuses on

publisher can demonstrate the sword is

should generally be recognised over

games that require a digital environment rarely used or abandoned after a given

the estimated life of the

to be maintained in which to use the

period; but conversely its consumption

gaming relationship.

virtual items. There are also simpler,

period could be longer than an

single-player mobile games where an

individual gamer’s game life if the sword application can be downloaded to a

can be transferred among players.

gamer’s smartphone and played remotely

without an online connection. In these

instances, a virtual item might carry no implied obligation so the game publisher could recognise revenue immediately.)

12 MIAG Issue: 8

Estimating the virtual item delivery

• Life of the good: item (or group of

• Life of the game: if the average period is often particularly difficult for items) is classified as consumable,

paying player life cannot be estimated, start-up publishers and/or new games.

periodic or durable and revenue is

or if a durable virtual item is likely to Start-ups might not retain the historical recognised accordingly.

be traded and used indefinitely,

data on player behaviour, item

revenue can be recognised over the

• Life of the gamer: revenue is

consumption and item transfer that is

life of the game. This method is not

recognised over the average period for

necessary for an accounting estimate of commonly used and results in a

which a paying player participates in

delivery period. And for new games such build-up of revenue towards the end of

the game or related games. The

data by definition does not exist.

the game life as each payment is

estimation of average gamer life might

Additionally, for some publishers, the

spread over the remaining (shrinking)

include (i) defining a player as

information might not be available

estimated game life. Game life can

terminated after a certain period of no because such information may only be

reflect factors such as plans for new

activity and calculating an actual

accessed by the developer. In such cases game content or sequels or game

attrition rate and average player life

game publishers could estimate the

closure; industry data for games in

based on that definition; and/or (ii)

average user life of paying players and similar genres; and impacts from the

using historical player behaviour data

use that as the delivery period for

launch of competitor games.

and employing statistical

virtual items. If a lack of relevant history extrapolation methods to the whole

or data precludes both an item level

player population to project future

approach (‘life of the good’) and a user player attrition, and calculating player life approach (‘life of the gamer’), then life based on that projected attrition

revenue can be recognised over the

rate. The most sophisticated

estimated ‘life of the game’, as the publishers might use actuarial

delivery period would not extend

methods similar to those used by life

beyond that date:

insurance companies to estimate the

life of policyholders.

Issue: 8 MIAG 13

Scenario

Game publisher P is acting as the

For each type of sword-skill, what is an principal in selling the game Warriors & appropriate appr oach to revenue

Wizards, a massive multi-player online recognition and what are the factors

swords-and-sorcery game. Players can

to consider?

buy enhanced sword-skills with

differing characteristics as listed below.

Sword-skill characteristic

Proposed revenue recognition

Example factors to consider

When used, the gamer’s sword-skills are Consumable item therefore recognise

If tracking such items individually is too improved for one duel only

revenue at single point in time when used onerous then consider estimating average period between purchase and use

On purchase, gamer’s sword-skills are

Periodic item therefore recognise revenue What is the probability the gamer will

improved for next 3 months

straight-line over 3 months from purchase continue to play for the full 3 months?

On purchase, gamer’s sword-skills are

Durable item therefore recognise revenue Is information available to estimate gamer permanently improved

straight-line over estimated life of gamer life? What if sword-skills become less

relevant as gamers progress from being

warriors to wizards?

Sword-skills are permanently improved and Durable item therefore recognise revenue Is there really an ongoing obligation? Can are transferred to anyone that defeats that straight-line over estimated life of game game life be estimated based on genre etc?

character

Will sword-skills remain relevant

throughout? What if gamers tend to drop out rather than their character be defeated? Are sequels planned or probable?

Conclusions on virtual items

As described above, when developing

life of the gamer or the life of the game.

estimates. If a publisher were to

a revenue recognition policy for the

This is sometimes the case for newer

expand its data collection and

sale of virtual items, one of the three game companies, whose data collection

analytic capabilities, enabling a more

methods might be appropriate

systems are still developing.

precise estimate, this would represent

depending on the facts and

a change in accounting estimate so

circumstances. Game publishers will

For mobile and web games, the publisher would be implemented prospectively.

also need to consider the availability

(often also the distribution channel) is Start-up companies reporting under

of information about how virtual

commonly acting as an agent for the

IFRS for the first time will need to

items are consumed. Estimating the

developer. If this is the case, determining consider all available information in

virtual item delivery period is likely

the appropriate revenue recognition

determining the proper estimates for

to be more difficult for games

model can be more complex. For

their historical financial statements.

publishers with a limited operating

example, such games publishers often do history or those launching a new

not necessarily have all the data for the game in a new genre.

virtual items as such information may

only reside with the game developer.

When it is not possible or practical to estimate the delivery period at the

Game publishers should ensure they

item level, game publishers might

have robust processes and controls to

need to instead estimate the average

develop and periodically review these

14 MIAG Issue: 8

Considerations for virtual

for completing a customer survey) or in

Considerations under IFRS 15

currency

connection with purchasing a specified

Under IFRS 15 online gaming

Online games often include virtual

amount of virtual currency (e.g.,

companies must decide whether control

currency that can be exchanged for

purchase 500 points and receive 100

of virtual items is delivered over a

virtual items. Virtual currency can be

points free). While these virtual

period of time or at a point in time. IFRS

sold to gamers by distribution channels currency points are merely digital

15 sets out three criteria to assess

such as:

strings of ones and zeros and are

whether control of a good or service is fungible, entities need to determine the transferred over time. If none of these

• Physical prepaid cards of virtual

amount of real money represented by

criteria are met, the control passes at a currency, sold in internet cafes or

each virtual currency point.

point in time, and that point in time

other retailers; or

must be established. Since these criteria

• Electronic virtual currency, sold by

A moving averaging approach is often

are different from the guidance in

intermediaries such as social website

adopted by game companies that

current standards, the pattern of

or directly by game publishers through periodically blend together existing revenue recognition will not always be

payment aggregators such as Paypal.

unused currencies and successive

the same.

issuance to calculate an average unit

The accounting on purchase of virtual

price. For example, assume gamers have One key consideration might be whether currency is typically straightforward:

1,000 unused virtual currency units

the virtual item purchased is distinct

debit cash, credit deferred revenue.

representing real cash payments of €100 from the underlying licence to play the Generally, revenue recognition remains

(an average unit price of €0.10 per unit), game. If it is determined that the virtual unaffected if the gamer must first buy

and a gamer pays for 5oo units for €50

item is distinct from the hosted

virtual currency to acquire a virtual

at €0.10 each, and receives 100 ‘free’

underlying licence, the pattern of

item i.e. revenue should be recognised

units. In this simple example, the

revenue recognition might be different

when or as the service is provided,

incentive simply results in a lower

from that under IAS 18. However, if it is which means on delivery and

effective per-unit price below €0.10 per determined that the virtual item is not consumption of the virtual item, not at unit (more precisely, €150 divided by

distinct from the underlying licence, it is the purchase of the virtual currency.

1,600 units). If promotions are

likely that the approaches used today

significant and frequent, keeping track and described above will remain

Complications can arise from

of such promotions can be a challenge.

appropriate under IFRS 15.

promotional programs. For example,

(See also example 4 below for further

free virtual currency may be granted as discussion on unused currency and

part of a promotion (e.g. a gamer

virtual items.)

receives free virtual currency in

exchange for first-time registration or Issue: 8 MIAG 15

Example 3: Multiple element arrangements

“Can I buy some more magic arrows for my magic bow?”

In example 3 we consider the challenges The usual multiple element rules apply

• Can revenue be reasonably

with separating virtual items into

to online gaming arrangements but

allocated between elements? IAS 18

multiple elements.

there are some unique considerations

permits appropriate methods of

that make the accounting inherently

allocating revenue between elements,

IAS 18 requires that, when the substance judgmental and complex.

meaning ideally relative fair value but of a single transaction indicates it

also allowing the residual and reverse

includes separately identifiable

Scenario

residual. In this bow-and-arrow

components each with value to the

As in example 2 above, game publisher P

scenario, since arrows are sold

customer, revenue is allocated between

runs Warriors & Wizards, a massive standalone, the value of the bow can

these components, usually by reference

multi-player online swords-and-

be imputed using the residual method,

to their fair values. Under current IFRS

sorcery game.

being the total price of bow-and-arrow

this might mean relative fair value or, if less the standalone selling price of a

the standalone fair value of an element is Players can buy virtual magical bow-bundle of arrows. Switching to a strict unknown (perhaps because it is never

and-arrows that never miss their target.

relative fair value approach would

sold in isolation), it can be imputed by The bow always comes with a quiver of

result in a different pattern of revenue deducting the sales price of known

arrows and additional quivers of arrows recognition compared to the

elements from the total transaction price can also be bought separately.

residual model.

i.e. the ‘residual’ and ‘reverse residual’

methods are both permitted.

What are the key judgements involved in recognising revenue on the sale of a

What types of multiple element

bow-and-arrow?

arrangements might arise in

online gaming?

• Does the item have standalone

Two common examples are:

value to the customer? Although the bow is never sold in isolation, it seems

• Bundled virtual items: a game

likely that the customer thinks he or

publisher may bundle different types

she is purchasing two items (the bow

of virtual items together and sell the

and the arrows). In the real world,

combination to a gamer, perhaps with

companies often look to competitors

a discount on the total.

to assess whether goods can be sold

• Subscription for premium access

standalone, but given the variations

bundled with virtual items: as the between games and publishers a

industry evolves these types of

comparison between games is less

bundled arrangements are becoming

meaningful here. Instead, publishers

more common. When gamers

can look within their game – into the

purchase these packages, they receive

virtual world – and assess whether

a specified period (e.g. one month) of

they could sell the items standalone or premium access or VIP status within

indeed if gamers have created a

the game, plus virtual currency or

secondary market by buying and

items that may have a life beyond the

selling goods (in this case, a bow

premium access period.

without arrows) within the game.

16 MIAG Issue: 8

Conclusions

Multiple element arrangements within Even if a transaction can be theoretically Similar considerations would apply to online gaming should follow the rules

unbundled it may be impractical (or

other gaming scenarios, such as when

of the real world i.e. separate elements cost-prohibitive) to track immaterial gamers pay for VIP access to a virtual

where possible and then recognise

items individually (such as virtual

world for a period of time (e.g. three

revenue for each element as it is

arrows) for revenue recognition

months) that includes other ‘free’

delivered. But sometimes, in the

purposes. However, if all the virtual

virtual goods or services that are

online world, this can mean looking

items have similar delivery periods, then used within that period (e.g. a virtual within the game (rather than outside

revenue could be recognised over the

limousine that can be used by the

it) to assess whether a transaction can total estimated delivery period. The

gamer only in the first month of the

be unbundled.

delivery period itself, whether for

subscription period).

individual elements or bundled items,

would be determined in accordance with

the guidance under example 2 above.

Considerations under IFRS 15

If more than one performance obligation is one of the most common methods The IFRS 15 model is built around

is identified, IFRS 15 includes more

used today, is now only permitted in

‘performance obligations’. A

specific guidance on the allocation of the very limited circumstances. Where there performance obligation is a distinct

total value of the contract (the

are no directly observable standalone

promise (or group of promises) in a

transaction price) to each of the

selling prices, estimation and allocation contract to transfer goods or services to performance obligations. Companies

can be complicated and requires

a customer. Performance obligations

will be required to use a relative

significant judgement.

replace the current concept of ‘elements’. standalone selling price basis. This IFRS 15 includes factors to consider

means that the company must establish

when determining whether a

what each of the performance

contractual promise is separately

obligations would have been sold for if identifiable from the other promises in sold on their own (using actual or

the contract. While in many cases the

estimated selling prices), and then

performance obligations identified

allocate the total contract value based under IFRS 15 might be the same as

on the relative value of each. The

under IAS 18, contracts will still need to residual method described above, which

be reassessed in light of the

new guidance.

Issue: 8 MIAG 17

Example 4: Unused currency and unused items

“What if I don’t spend all my virtual currency? Or I leave some magical arrows in my quiver?”

In example 4 we consider how game

publishers must choose an appropriate

reflect expected forfeitures prior to

publishers should account for unused

accounting policy. (Recognising all of

the actual expiry date. Such a

virtual currency and unused virtual

the expected breakage upfront is

treatment would be dependent on a

items – that is, the accounting

generally not allowed!) The appropriate reliable and evidenced history of

for ‘breakage’.

model will depend on the specific

breakages. In this model, a

features of the arrangement and the

proportional part of the estimated

What is ‘breakage’?

game publisher’s ability to reliably

breakage is recognised together with

Game publishers often sell prepaid cards estimate breakage. Three possible actual redemptions as they occur. In

that a customer can use to acquire

approaches are:

other words, the amount that is

virtual currency or virtual goods. On

expected to be forfeited is recognised

• Liability model: the publisher could sale of a prepaid card or virtual currency as revenue at the same time as

choose to recognise revenue when a

the game publisher has an obligation to services are delivered for the portion

gamer’s right to redeem expires. This

provide a future game service to the

is redeemed.

model might be most appropriate if

customer. Typically, holders do not use the publisher is not able to reliably

How should a game publisher

all prepaid cards and/or all virtual

estimate breakage. However, this

account for unused virtual items?

currency. The unredeemed portion is

model is unlikely to be appropriate if

In addition to unredeemed prepaid

commonly referred to as ‘breakage’.

the prepaid cards or virtual currency

cards and virtual currency, there can

have no expiry date.

also be breakage for virtual items. The Based on the gamer’s contractual rights, attention of many gamers inevitably

publishers must determine whether

• Remote model: publishers that can moves from one game to the next,

unredeemed amounts represent

reliably estimate the pattern of

meaning some unused consumable

deferred revenue or other liabilities.

redemptions over time may be able to

virtual items will not be consumed and

Additionally, in some countries

determine when the likelihood of

some durable virtual items will no

publishers should evaluate whether

further redemptions becomes remote.

longer be used.

escheatment laws apply i.e. should the

It would be appropriate to recognise

unredeemed portion be treated as

breakage at that time, based on the

• Consumable items: if a game

unclaimed property and remitted to a

expectation that the gamer holding

publisher has adequate historical data, government authority. A game publisher

the rights will not demand

the revenue associated with the unused

would be unable to recognise revenue

performance. That expectation should

consumable virtual items can usually

from breakage if it represents

be developed using relevant historical

be accounted for under one of the three escheatable funds.

experience. Such a model should not

acceptable approaches to unused

result in immediate revenue

virtual currency discussed above.

How should a game publisher

recognition for forecast breakage since

account for unused virtual

some time must elapse before the

• Period items: for items that are

currency?

point is reached when further

consumed over a specified period of

redemptions become a

time, the concept of breakage is

If unused prepaid cards and unused

remote possibility.

usually not applicable as the items will virtual currency are not escheatable, a expire as the period ends. Assuming

game publisher can recognise income

• Proportional model: when a reliable, this period is shorter than the

from the estimated breakage. IFRS does

supportable estimate can be made for

anticipated gamer life, revenue for the not prescribe a specific method for

expected breakage, revenue

periodic item will already be

recognising breakage so game

recognition by the game publisher can

recognised before ‘breakage’ occurs.

18 MIAG Issue: 8

• Durable items: for unused durable virtual items, revenue is recognised

over the estimated life of the gamer or game, both of which are developed

based on estimated player attrition.

Such estimation of player attrition

naturally takes into account repeated

game play and breakage factors so

automatically spreads the revenue

associated with breakage over the

delivery period.

Considerations under IFRS 15

Conclusions

developer when the gamer demands a

If the game publisher expects that not all In conclusion, breakage can have a

certain good or service. Alternatively, unused items will be used by the

significant effect on the timing and

virtual currency sold by the publisher

customer, the guidance in IFRS 15 is

pattern of revenue recognition. The

might be redeemed by the gamer with

more prescriptive than current practice.

model adopted will depend both on

another company, which would

Where the publisher expects there to be actual usage patterns and the quality require the publisher to make a breakage, the pre-paid amount that is

and granularity of available data.

payment to that company.

expected to be forfeited is recognised as The selection of a recognition model

revenue when services are delivered for for breakage is an accounting policy

Where the game publisher has to pay

the portion that is redeemed (similar to election that the game publisher

cash when virtual currency is

the proportional model described

should apply consistently to similar

redeemed, rather than just provide a

above), subject to the requirement that arrangements.

good or service, it is less clear how

the publisher must be satisfied that it is any expected breakage should be

highly probable that it will not be

The discussions above assume that

accounted for. At the time of this

necessary to reverse a material amount

the game publisher is transacting

publication, the IFRS Interpretations

of revenue in a future period.

directly with the gamer so has no

Committee is debating whether the

obligation to provide anything other

liability to pay cash in such scenarios If the publisher does not expect there to than the virtual goods or services

constitutes a financial liability,

be breakage, revenue is recognised only when the gamer demands them.

which would mean that no breakage

when it considers that there is only a

Sometimes, if the game publisher is

can be recognised. Given that this is

remote possibility that the customer will acting as an agent for a game

a developing area of guidance and

exercise his or her right to demand

developer, the game publisher might

could be complex, we recommend

further goods or services.

be acting as an intermediary that

that you consult with an adviser if

collects cash from the gamer and that this might apply to you. (This is then obliged to pay cash to the

ongoing debate will be equally

applicable when IFRS 15 is adopted.)

Issue: 8 MIAG 19

Conclusion

The significant growth of online gaming for online gaming companies when is driven partly by online players

considering the real revenue recognition interacting with online friends and

issues that arise in virtual worlds. The rivals, and partly by the rise of mobile answer for complicated real life

gaming facilitated by increasing

arrangements will depend on the

penetration of smartphones and tablets.

specific facts and circumstances in each New technology platforms and new

case. Where transactions are significant, entrants have driven new business

management should include disclosures

models such as ‘freemium’ games that

in the financial statements that enable are free to play but in which real cash users to understand the conclusions

must be spent to acquire virtual goods or reached. As always, planning ahead can other premium content.

prevent painful surprises.

This paper has considered the resulting We hope you find this paper useful and

accounting challenges in various

welcome your feedback.

practical examples covering principal/

agent arrangements, virtual items and

To comment on any of the issues

virtual currencies, and multiple element highlighted in this paper please visit our arrangements.

dedicated website www.pwc.com/miag

or contact your local PwC entertainment The scenarios in this paper are clearly and media specialist.

not designed to be exhaustive; but they will hopefully provide food for thought

20 MIAG Issue: 8

Issue: 8 MIAG 21

Further reading

www.pwc.com/miag

MIAG

Issue: 3

www.pwc.com/miag

MIAG

Issue: 4

Media Industry

April 2012

Media Industry

June 2012

Accounting group

Accounting group

Making sense of a

Making sense of a

complex world

complex world

Broadcast television:

Accounting for royalty

Acquired programming

arrangements – issues

rights

for media companies

This paper explores the

This paper explores some

critical considerations

of the key challenges under

under IFRS relating to the

IFRS in accounting for

recognition, presentation,

royalty arrangements by both

amortisation and

licensors and licensees.

impairment of acquired

programming rights.

EP6-2012-01-23-02 32-SW_MIAG Issue 4v7.indd 1

22/06/2012 17:13:40

MIAG Issue: 3

MIAG Issue: 4

MIAG Issue: 5

Broadcast television: Acquired

Accounting for royalty arrangements –

Content development and cost

programming rights

issues for media companies

capitalisation by media companies

This paper explores the critical

This paper explores some of the key

This paper explores the critical

considerations under IFRS relating to

considerations under IFRS in

considerations relating to the

the recognition, presentation,

accounting for royalty arrangements by classification, capitalisation and amortisation and impairment of

both licensors and licensees.

amortisation of content development

acquired programming rights.

spend under the applicable IFRS

standards IAS 2 Inventories and IAS 38

Intangible Assets, focusing on the television production, educational

publishing and video game sectors.

22 MIAG Issue: 8

MIAG Issue: 6

MIAG Issue: 7

Global E&M Outlook

Revenue recognition: principal/agent

Revenue recognition: payments to

PwC’s Global entertainment and media arrangements – issues for media

customers – issues for media

outlook contains detailed industry companies

companies

analysis and forecasts trends in the

This paper considers the assessment

This paper explores some of the key

global entertainment and media

of the key principal/agent

IFRS accounting considerations for

industry over the next five years across considerations in various practical

payments by media companies to their 13 industry segments in 54 countries.

examples, covering physical books,

customers, covering the purchase of

eBooks, television content and film

advertising space, physical and digital production.

‘slotting fees’, outsourced advertising sales and video game prizes.

Issue: 8 MIAG 23

Contacts

Global leader

Australia

Mexico

Marcel Fenez

Rosalie Wilkie

Miguel Arrieta

marcel.fenez@hk.pwc.com

rosalie.wilkie@au.pwc.com

jose.miguel.arrieta@mx.pwc.com

+852 2289 2628

+61 2 8266 8381

+55 5263 6000 Ext 5857

EMEA leader

Brazil

Netherlands

Phil Stokes

Estela Vieira

Ennel van Eeden

phil.stokes@uk.pwc.com

estela.vieira@br.pwc.com

ennel.van.eeden@nl.pwc.com

+44 20 7804 4072

+55 11 3674 3802

+31 88792 4540

MIAG leader

Canada

Russia

Sam Tomlinson

John Simcoe

Natalia Yakovleva

sam.tomlinson@uk.pwc.com

john.b.simcoe@ca.pwc.com

natalia.yakovleva@ru.pwc.com

+44 20 7804 0726

+1 416 815 5231

+7 495 967 6395

China

Singapore

Wilson Chow

Charlotte Hsu

wilson.wy.chow@cn.pwc.com

charlotte.hsu@sg.pwc.com

+86 755 8261 8886

+65 6236 7668

France

South Africa

Richard Bejot

Vicky Myburgh

richard.bejot@fr.pwc.com

vicky.myburgh@za.pwc.com

+33 1 5657 6039

+27 11 797 4305

Germany

Spain

Christoph Gruss

Inmaculada Izarra

christoph.gruss@de.pwc.com

inmaculada.izarra@es.pwc.com

+49 69 9585 3415

+34 915 68 5176

Hong Kong

Switzerland

Cecilia Yau

Patrick Balkanyi

cecilia.yau@hk.pwc.com

patrick.balkanyi@ch.pwc.com

+852 2289 1385

+41 587 922 676

India

United Kingdom

Smita Jha

Sallie Deysel

smita.jha@in.pwc.com

sallie.deysel@uk.pwc.com

+91 98 1114 1190

+44 20 7212 5845

Italy

United States

Andrea Samaja

Bob Barrett

andrea.samaja@it.pwc.com

New York

+39 2 6672 0555

bob.barrett@us.pwc.com

+1 703 283 7040

Japan

Hideaki Zenba

hideaki.zenba@jp.pwc.com

+81 80 3158 6368

24 MIAG Issue: 8

Issue: 8 MIAG 25

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