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IAS 38
Intangible Asset - Coggle Diagram
IAS 38
Intangible Asset
Definition
- An identifiable non-monetary asset without physical substances
- identifiable
- control
- future economic benefit
Recognition (3+1)
- identifiable
a. separable (rent / sell)
b. not separable (if contractual right)
- control
a. right to obtain FEB
b. right to stop other access
- future economic benefit
a. probable generate revenue
b. probable reduce cost
- cost or value
a. cost must be measured reliable
Subsequent Expenditure
- these all other expenditure related to intangible asset which do not meet the criteria of identifiable intangible asset / goodwill on business combination acquired = expenses as incurred
Basic Rule
- have Market transaction then can recognized
SOFP - other intangible
(purchase brand / license/ trademark) as a separate transaction
- cost: purchase price + direct cost
-
Acquisition part of business combination
= recog as intangible asset separately from goodwill
(is to reduce minimum the amount)
- the cost of intangible asset acquired part of combination business measures at FV at the date acquired
- no recog when FV cannot be reliably measured
-
Measurement
-
Subsequent measurement
COST model
- definite life (must depreciation, impairment only if evidence)
- indefinite life (no depreciation, must impairment )
Revaluation model
- only if there is an active market
Finite Life
- EUL is determining for intangible asset containing legal / contractual rights
- (cost-ERV)/EUL = x (charge to SOPL)
- have evidence for impairment then need do impairment test
- amortization over the shorter of its EUL or the expected life
- if can renew / extend the life of intangible asset, then amortization the intangible over the extended life
- if cost of renew is major then capitalized cost and derecognizedprevious intangible
Indefinite Life
- meet the criteria but unable to forecast reasonably how long the asset will be generate FEB
- no amortization
- impairment test must be conduct annually
- indefinite life reviewed annually and check the evidence whether the asset can change to definite life.
- if it is indication the may impair and must tested for impairment