The document discusses IAS 38, which specifies the accounting treatment for intangible assets, including their recognition and measurement. It outlines criteria for capitalizing development costs, the distinction between research and development expenditures, and concepts like goodwill, amortization, and impairment loss. Additionally, it explains the finite and indefinite useful life of intangible assets and emphasizes the importance of these assets in business operations.

1. IAS 38 Intangible assets
By Tadie Kendra

2. Objectives
• The varied Intangible assets
• Goodwill
• Recognition( what they are)
• Treatment

3. IAS 38
• Was applied to the international standards on 31 March 2004
the first rule was adopted in the 1970s
• Objective --- to specify the accounting treatment for intangible assets ( this is
not covered by another standard)

4. What are intangible assets
• Identifiable non-monetary assets with a physical substance
• Intanglible assets : controlled by an entity
Future economic benefits are expected

5. Conditions met
• It is probable that a future economic benefits
• The cost of the asset must be reliably measurable
• If the asset is acquired separately, as an asset, then its cost consists of
purchase price and any directly attributable costs of preparing the asset of its
intended use

6. Internally generated intangible assets
• IAS provides a guideline on different internally generated assets

7. DEVELOPMENT
• Simply the design of prototypes tools , models and etc
CAPITALIZED ( the expenditure for the development stage)

8. IAS has certain criteria for the development
• So we can use pirate
P Probable future economic benefits
I Intention to complete and use or sell it
R Resources adequate and available to complete and use or sell it
A Ability to use or sell the asset
• T Technical feasibility to complete it
E Expenditures realibly measurable

9. Research
• Original and planned investigation undertaken in the prospect of gaining
new scientific or technical knowledge and understanding
• You do not capitalize any costs of research
expense them in the SPL

10. Goodwill
• The amount by which the value of a business exceeds the value of the net
assets in the statement of financial position
• IAS only permits purchased goodwill to be accounted for because of the
money measurement concept.
• Inherent goodwill is just a matter of opinion

11. Other Key terms to look out for in my
presentation
• Ammortisation – the non tangible asset equivalent to depreciation where the
value of the intangible asset is reduced over its life
• Impairment loss – when the recoverable amount is less than the fair value
• Useful life – the amount of time that the business expects to keep the asset

12. Remember those other intangibles ?!
• Patents copyrights and trademarks
• Licences that protect a business from having its ideas or designs stolen by a
competitior

13. Treatment
• Subsequent measurement
Cost model
cost – accumulated amortization – accumulated impairment loss

14. Other important aspects of intangible assets
• Useful life
finite- knowing the periods the asset is going to work
indefinite – no forseeable limit to which the asset will generate some cash
flows

15. Thank you
• I hope you learnt a thing or two from my presantation