Under IFRS 15, there are certain criteria that need to be considered when determining whether to account for two or more contracts as one combined contract:

1. Contracts are Negotiated as a Package: If the contracts are negotiated together as a package with a single commercial objective, they should be combined.
2. Amount of Consideration is Interdependent: The amount of consideration to be paid in one contract depends on the price or performance of the other contract. For instance, if a discount in one contract is predicated on the customer agreeing to a second contract, the contracts should be combined.
3. Goods or Services are a Single Performance Obligation: The goods or services promised in the contracts (or some of them) are a single performance obligation. This means that goods or services in the different contracts are significantly interrelated or interdependent, they should be combined.

When these criteria are met, the contracts are accounted for as one contract. This means the transaction price and the performance obligations from all the contracts are aggregated, and revenue is recognized based on the combined contract. This can affect the timing and amount of revenue recognized. The purpose of this is to ensure that the revenue recognition reflects the substance of the contracts rather than their legal form.

Here is the example illustrating the concept of combined contracts under IFRS 15:

Suppose a car manufacturer signs two contracts with a customer on the same day: one for the sale of a car and another for a three-year maintenance service. The contracts are negotiated as a package deal, the price of the car is discounted if the customer also purchases the maintenance service, and the services of the maintenance are highly interrelated to the use of the car.

In this scenario, the three criteria for combined contracts are met:

1. The contracts were negotiated as a package with a single commercial objective.
2. The amount of consideration in one contract (the car sale) depends on the price or performance of the other contract (the maintenance service).
3. The goods or services in the two contracts are significantly interrelated.

As a result, under IFRS 15, these two contracts should be combined and treated as one contract. The transaction price will be the total of the agreed prices in the two contracts, and the performance obligations will be the delivery of the car and the provision of the maintenance service over the three-year period.

Depending on whether these performance obligations are considered distinct, the entity may either recognize revenue for each obligation as it is satisfied over time or recognize the entire revenue once both obligations have been satisfied.