Yakub02
Banned
Extra guidance for intangible assets acquired in a business combination.
Any intangible asset identified in a business combination will be recognised as both recognition criteria are deemed to be recognised.
If an intangible asset is acquired in a business combination, its cost is the fair value at the acquisition date.
If cost cannot be measured reliably then the asset will be subsumed within goodwill.
In-process research and development The acquiree might have a research and development project in process.
Furthermore, it might not recognise an asset for the project because the recognition criteria for internally generated intangible assets have not been met.
However, the acquirer would recognise the in-process research and development as an asset in the consolidated financial statements as long as it: meets the definition of an asset; and is identifiable, i.e. is separable or arises from contractual or other legal rights.
In other words, expenditure incurred on an in-process research or development project acquired separately or in a business combination and recognised as an intangible asset is accounted for in the usual way by applying the IAS 38 recognition criteria
Measurement after initial recognition Intangible assets are recognised at cost when first acquired.
The two measurement models for intangible assets after acquisition are: cost model (i.e. cost less accumulated depreciation); and
revaluation model (i.e. revalued amount less accumulated depreciation since the most recent revaluation). The same model should be applied to all assets in the same class Revaluation of an intangible asset is only allowed if the fair value can be determined by reference to an active market in that type of intangible asset
Any intangible asset identified in a business combination will be recognised as both recognition criteria are deemed to be recognised.
If an intangible asset is acquired in a business combination, its cost is the fair value at the acquisition date.
If cost cannot be measured reliably then the asset will be subsumed within goodwill.
In-process research and development The acquiree might have a research and development project in process.
Furthermore, it might not recognise an asset for the project because the recognition criteria for internally generated intangible assets have not been met.
However, the acquirer would recognise the in-process research and development as an asset in the consolidated financial statements as long as it: meets the definition of an asset; and is identifiable, i.e. is separable or arises from contractual or other legal rights.
In other words, expenditure incurred on an in-process research or development project acquired separately or in a business combination and recognised as an intangible asset is accounted for in the usual way by applying the IAS 38 recognition criteria
Measurement after initial recognition Intangible assets are recognised at cost when first acquired.
The two measurement models for intangible assets after acquisition are: cost model (i.e. cost less accumulated depreciation); and
revaluation model (i.e. revalued amount less accumulated depreciation since the most recent revaluation). The same model should be applied to all assets in the same class Revaluation of an intangible asset is only allowed if the fair value can be determined by reference to an active market in that type of intangible asset
