Intangible Asset

Running Head : Name of StudentName of Subject CourseName of Professor3 March 2008 An abstract is an summation of value that cannot be physically touched lighten subject to amortization . Its becoming an addition is determined by the international accounting standard . It non-compliance with the standard has a bend which affects decision makers . This seeks to support this assertion by analyzing what be these nonphysicals and the requirements for their origination and recognition and the consequence for non complianceThe international accounting standard (IAS ) regulates impalpables is (IAS ) 38 as enjoind by the accounting standards board (IASB in that keep are however opposite rules under the different standards on impalpables issued by the IASB but precisely the purpose of the IAS 38 is to g everywheren the acco unting treatment for nonphysicals assets that are not deal with specifically in early(a) IAS . The criteria under IAS 38 determine when to iron out intangible asset in the books and how to comply with the disclosure requirements in matters of preparing the financial statements of a company . To be considered as intangible asset , the same must(prenominal) be controlled by the endeavor as a result of past events which could either be by purchase or self-creation and time to come scotch benefits must be expected by the enterprise . Said stinting benefits whitethorn take the form of cash in hang ups or other assets that tot up increase wealth of the enterpriseNot all kinds of intangible assets is governed by the rules under IAS 38 . What are not covered may embroil the following (1 ) financial assets (2 ) mineral rights and exploration and training personify incurred by mining and oil and gas companies (3 ) intangible assets arising from policy contracts issued by insuran ce companies and (4 intangibles covered by t! he another(prenominal) IAS or IFRS much(prenominal) as intangibles held for sale , deferred tax assets , learn assets , assets arising from employee benefits , and goodwillBy definition to a higher place the following are therefore the attributes of an intangible : identifiability , control and rising economic benefits which could take the form of revenues or reduced future costs . An asset is identifiable when it is up to(p) of being garbled and sold transferred , licensed , rented , or transfer (Olsen and Halliwell 2007 Webster and Jensen , 2006 ) either apiece or part of the package and (2 ) arises from contractual or other legal rights . There is control when it has the cause of obtaining benefits from the assetUnder IAS 38 , an intangible could only be recognized as asset whether the asset is self-created or purchase if the following are requirements are complied with (1 ) it is verisimilar that future economic benefits that are credited(predicate) to the asset will flow to the enterprise and (2 ) the cost of the asset can me measured faithfully . If the asset is generated internally there is additional requirement . It is needful that the probability of future economic benefits must be ground on reasonable and supportable assumptions and conditions that will exist over the life of the assets (IAS 38 . It will be observed...If you want to meet a full essay, set up it on our website: OrderEssay.net

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