Intangibles Flashcards
R and D
Expense immedietly
Indications for impairment
Cost Factors,financial performance, entity’s cash flow, macroeconomic conditions,environemnt
Fair value approach
Can be arrived by one of the approaches-Market, Income, Cost.
impairment methods
Straight line, Units of sale, NRV
Goodwill
Expenses
cash
Steps in Impairment-Goodwill
Carrying Value>F.V=Impairment loss
Fair value of net assets vs fair value of reporting unit=implied goodwill
Goodwill for non -public entities
One step process 10 years straight line depriciation
Amortization of Intangibles
Straight line,Units of sale,Net reliazable value
Goodwill for public entities
10 years of amortization
Software Costs- For beginning upto technological feasibility
R and D
How Goodwill is assigned
In a business combination Goodwill is assigned to one or more reporting units. A reporting segment may be operzting segment or one level below
can goodwill be recorded internally
A company cannot record Goodwill internally the internal cost of developing or restoring it.
R and D expense
Rand D expense=Program,design,coding and testing
Software Costs
Coding and testing
duplication training materials packaging
production costs
