UK GAAP for Business and Practice
Complete with summaries of current standards and key implementation dates, this book provides a concise and easily accessible guide to all the recent changes in UK GAAP, and their likely practical impact.
TABLE OF CONTENTS UK GAAP for Business and Practice
Chapter 13: Intangible Fixed Assets, Including Goodwill
13.1 Introduction
a Statutory Headings
Companies Act 1985 Sch 4 includes the following sub-headings for intangible fixed assets:
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development costs;
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concessions, patents, licences, trade marks and similar rights and assets;
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goodwill.
b Definition
FRS 10 Goodwill and intangibles, defines intangible assets as non-financial fixed assets that do not have physical substance but are identifiable and are controlled by the entity through custody or legal rights.
c Regulatory Framework
1 Companies Act 1985
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format headings these were referred to in (a) above.
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accounting rules there are two important rules:
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intangibles such as concessions, patents, licences, trade marks and similar rights and assets may only be included in the balance sheet in either of the following situations:
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the assets were acquired for valuable consideration and are not effectively part of goodwill, or
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the assets were created by the company itself. (Note that the Companies Act 1985 prevents non-purchased or internally generated goodwill from being included on the balance sheet).
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intangible assets (other than goodwill) may be included at their current cost. This alternative to historical cost is permitted by the alternative accounting rules of Schedule 4.
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2 SSAPs and FRSs
Accounting standards deal with research and development (SSAP 13), and goodwill and intangibles (FRS 10). These statements are referred to below.
d Illustrations
The following are examples of some intangible fixed asset headings which have appeared in published accounts:
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goodwill;
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development costs;
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brand names;
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patents, trade marks and other product rights;
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trade values of retail outlets;
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betting office licences;
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know-how agreement;
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programmes, film rights and...
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