Intangible Asset

Running Head : Name of StudentName of Subject CourseName of Professor3 March 2008 An impalpable is an summation of value that cannot be physically touched save subject to amortization . Its becoming an asset is determined by the international accounting standard . It non-compliance with the standard has a bit which affects decision makers . This seeks to support this assertion by analyzing what be these nonphysicals and the requirements for their introduction 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 respect are however opposite rules under the different standards on intangibles issued by the IASB but precisely the purpose of the IAS 38 is to prescribe the accounting treatment for intangibles assets that are not deal with specifically in other IAS . The criteria under IAS 38 determine when to clear 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 future scotch benefits must be expected by the enterprise . Said stinting benefits whitethorn take the form of cash inflows or other assets that impart increase wealth of the enterpriseNot all kinds of intangible assets is governed by the rules under IAS 38 .

What are not covered may include the following (1 ) financial assets (2 ) mineral rights and exploration and training cost incurred by mining and oil and gas companies (3 ) intangible assets arising from insurance contracts issued by insurance companies and (4 intangibles covered by the another(prenominal) IAS or IFRS such as intangibles held for sale , deferred tax assets , learn assets , assets arising from employee benefits , and goodwillBy definition above the following are therefore the attributes of an intangible : identifiability , control and future 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 separated and sold transferred , licensed , rented , or transfer (Olsen and Halliwell 2007 Webster and Jensen , 2006 ) either individually 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 probable 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 reliably . If the asset is generated internally there is additional requirement . It is required that the probability of future economic benefits must be based 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 get a full essay, set up it on our website: Ordercustompaper.com

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