Warranties can be treated in two different ways under IFRS 15, depending on the nature and terms of the warranty. Here are the two types of warranties and how they are accounted for:

1. Assurance-Type Warranties: These are warranties where the product is guaranteed to function as expected for a certain period of time. The customer is assured that the product will work as intended. Such warranties are not accounted for as separate performance obligations. Instead, they are considered a cost accrual issue. A provision for the expected warranty costs is recognized at the time of the sale based on historical experience and other relevant factors. Revenue for the sale of the good or service is recognized in full upon the transfer of control to the customer, with a separate warranty provision recognized as a liability.
2. Service-Type Warranties: These are warranties that provide an additional service beyond the assurance that the product complies with agreed-upon specifications. For example, a warranty that provides for regular maintenance checks or cleaning services would be a service-type warranty. These warranties are treated as separate performance obligations. The transaction price is allocated between the good or service and the warranty service based on their relative stand-alone selling prices. Revenue related to the warranty service is recognized over the period that the warranty service is provided.

It's important to note that sometimes, a warranty can have both assurance and service components. In these cases, if the entity can reasonably account for them separately, it should do so. If not, the warranty is accounted for as a service-type warranty.