Easy definition
Paragraph 8 of AASB 138/IAS 38 defines an intangible asset as:
an identifiable non‐monetary asset without physical substance.
An intangible asset must be:
- identifiable - if it is separable or arises from contractual or other legal rights
- non‐monetary in nature - money held and assets to be received in fixed or determinable amounts of money
- without physical substance - relates to the ability to be able to see and touch an asset, such as a building or machinery
Items that do not meet all three characteristics cannot be recognised as intangible assets in financial statements.
Hence, the definition itself leads to the exclusion of some items from the statement of financial position.
How to measure them
Cost.
The amount of cash or cash equivalents paid or the fair value of other consideration given to acquire an asset at the time of its acquisition or construction.
What is it is "internally generated"?
Two phases:
- Research - original and planned investigation undertaken with the prospect of gaining new scientific or technical knowledge and understanding
- Development - the application of research findings or other knowledge to a plan or design for the production of new or substantially improved materials, devices, products, processes, systems or services before the start of commercial production or use
Trend in intangibles:
