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Week 4 ACC- Intangibles (Definition (Intangible Asset (Importance of…

- - - - Identifiability creates barriers to recognition in financial statements. It is a test of:
        
        Separability: The capacity of being separated from entity and sold/transferred
        
        Contractural or legal rights: Must demonstrate control over asset
    - - Non-financial
      - Future economic benefits are undeterminable
      - No determinable amount of future benefits
    - - Assets don't have to be tangible
      - existence of intangibles can only be shown by oberving economic transactions
      - Cannot be touched
    - - need support to create value
      - loses value quickly
      - don't create value or generate growth on their own
      - Increasing expenditure on intangibles
- - - - Cost Model: Costs less acc amm and Impairment loss
        
        Compromises Purchase price, import duty and other costs in preparing asset for intended use
      - Revaluation Model: FV less ACC Amor and ACC impairment
        
        Needs an active market
        
        Effectively ruled out for intangibles
      - AASB138.72: Choose either if there is an active market
    - - Systematic allocation
      - Impairment
      - Must assess useful life of asset
    - - Finite
        
        From the date asset is available for use
        
        Until held for sale
        
        Reflective of FEB or on straight-line
        
        Depreciable amount: Cost less residual value
- - - - Technical feasability
      - FEB expected
      - Adequate resources
      - Ability to use or sell
      - intention to complete
      - Reliable measurement
- - - - Not seperable
      - doesn't satisfy RC
  - - - Measured at cost
    - - Fair value at acquisition date