IAS 38

 Cost model: ◦ Cost less accumulated amortisation and any accumulated impairment losses  Revaluation model: ◦ Fair value at the date of revaluation less subsequent accumulated amortisation and impairment losses ◦ Fair value should be measured reliably with reference to an active market ◦ Very difficult as active markets do not exist for most classes of intangible assets ◦ Entire class to be revaluated

 Useful life: ◦ Assess whether finite or indefinite ◦ Indefinite – no foreseeable limit to the period over which the asset is expected to generate cash flow ◦ Finite useful life – amortised ◦ Indefinite useful life – not amortised ◦ Entity’s right to IA achieved through legal for finite period (eg. 5 year licence to broadcast) – useful life cannot exceed period of legal right unless legal right is renewed

 Amortisation: ◦ Only applicable to IA with finite useful life ◦ Amortisation method used to reflect pattern in which future economic benefits are expected to be consumed by the entity ◦ If pattern cannot be established – straight line method ◦ Review method at every year-end

 Residual value is NIL, unless: ◦ Commitment by 3 rd party to purchase ◦ There is an active market for IA which will still exist at the end of the asset’s useful life ◦ Review residual value at every year-end

 Eliminate for SOFP when disposed of  Gain or loss on disposal to be recognised in I/S

 Distinguish between internally generated and other IA  Whether the useful lives are indefinite or finite and, if finite, the useful lives (e.g. five years)  The amortisation methods used  The gross carrying amount and any accumulated amortisation (including accumulated impairment losses) at the beginning and end of the period

 Reconciliation of the carrying amount at the beginning and end of the period, showing: ◦ Additions ◦ Assets classified as held for sale ◦ Revaluations ◦ Impairment losses ◦ Amortisation ◦ Any other movements