Section 3300: Intangible Assets
International Accounting Standard 38
Intangible Assets
1. First version of IAS 38
"Intangible Assets" issued in September 1998
2. Revisions
Revised in March 2004
[U.S. GAAP Codification Topic]
350 Intangibles - goodwill and other
3. Intangible Asset
(1) intangible asset does not have physical substance
(2) intangible asset is an identifiable non-monetary asset
4. Non-monetary Asset
Asset other than monetary asset
5. Monetary Asset
(1) money held is monetary asset
(2) asset to be received in (a) is monetary asset
--> (a) fixed or determinable amounts of money
6. Recognition of Intangible Assets, IAS 38.21
Intangible asset is recognised
--> if and only if (1) and (2) are satisfied:
(1) probable future inflow of economic benefits
(2) cost of asset can be reliably measured
7. Internally Generated Goodwill
--> is not recognised as an asset, IAS 38.48
8. Internally Generated Intangible Assets are
--> not recognised as an asset from a research phase
--> recognised as an asset from a development phase
if and only if certain conditions are met, IAS 38.54, 57
9. Conditions, IAS 38.57
Internally generated intangible assets from a development phase
--> are recognised as asset
--> if and only if the conditions (1) - (6) are demonstrated:
(1) completion is technically feasible
(2) intention to complete
(3) ability to use or sell
(4) resources are available to complete and use or sell
(5) probable future economic benefits
(6) costs can be reliably measured
10. Subsequent measurement of intangible assets, IAS 38.72
(1) Cost Model:
Subsequent measurement = cost - (a) - (b)
(a) Accumulated amortisation
(b) Accumulated impairment losses
(2) Revaluation Model:
Subsequent measurement = revalued amount - (c) - (d)
(c) Subsequent accumulated amortisation
(d) Subsequent accumulated impairment losses
11. Intangible assets with finite useful lives
Depreciable amount of intangible assets with finite useful lives
--> is amortised over its useful life
12. Residual value is assumed to be zero
Exceptions:
--> if there is a third party commitment to purchase
--> if there is an active market at the end of useful life
13. Intangible assets with indefinite useful lives
--> are not amortised
--> but tested for impairment,
--> annually or when there is an indication of impairment
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