Intangible assets (IA)

Intangible assets (IA)

1. DEF: without physical substance; is identifiable; non-monetary; & meet asset DEF.

2. Identifiable criterion

   • separable from entity & sold; OR arises from contractual/legal rights are transferable.

3. Recognition

   • Probable future economic benefits flow to entity; & costs measured reliably.

4. Measurement (Initial)

   • Separate acquisition
   • Acquisition part of Bus. Combo
   • Exchange transactions
   • Acquisition by government grant
   • Internally generated IA
     • Research phase: Recognise expenditure in P/L when incurred
     • Development phase
       • IA recogn. only IF: 1. IA will be available for use/sale; 2. Intention to complete to use/sell; 3. Ability to use/sell; 4. How IA will generate economic benefits; 5. Availability of resources to complete IA; 6. Reliably measure direct expenditure.
     • Brands, mastheads, publishing titles, customer lists not recogn. as IA (IAS38.63)
     • Website costs
       • Planning stage = Research stage
       • Graphical & content development: Capitalised only if development cost directly linked to prepare website for intended use, IF not expense to P/L
       • Operating stage: Expense to P/L