Notesale: Turn your study into money

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Intangible assets - identifiable, non-monetary assets without physical substance
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Identifiability
- Separable from the entity
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2
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- Prevent others from obtaining such economic benefit
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Future economic benefit - additional sales, cost savings
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It meets the definition criteria of intangible assets
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It meets the asset recognition criteria
a
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b
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Initial Measurement at Cost:
A
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Separate Acquisition = Purchase Price + Directly Attributable Cost (DAC)
2
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Government Grant = Either Fair value or Nominal amount + DAC
4
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Internally Generated = DAC after meeting 6 criteria
B
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Cost Model = Cost - Accumulated Depreciation - Accumulated Impairment Loss
2
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Amortization
- Amortization expense is either:
a
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Period cost - selling or administrative expense
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Goodwill
- Under IFRS 3: Business Combination
- Goodwill arising from Business Combination is recorded separately from other
intangible asset
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- Not amortized but tested for impairment annually however not subject to reversal of
previous impairment loss
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Direct valuation - Goodwill is measured based on the future earnings of the entity
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Research phase (all costs are expensed)
- to discover new knowledge to be used in developing new products or improving
existing products
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Development phase
- application of new knowledge
- generally expensed as incurred
- capitalize if all met:
a
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Intention to complete and use/sell
c
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Ability to use or sell the asset
e
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Expenditures reliability measurable



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