1. Chapter 16

2.  An asset that : 1. Has no physical substance… which means? 2. It is identifiable… which means? 3. It is non- monetary.

3.  Trademarks.  What is a Trademark?

5.  Google, in the filing for its initial public offering, worried that the term “Google” could one day become synonymous with “search”. This would result in both a loss of trademark protection and reduced brand value.  Google’s trademark–now the most valuable trademark on the planet, is worth an estimated $44 billion.

6.  Other Trademark values  Microsoft: $42.8 billion ( second most valuable trademark)  Vodafone: $30.7 billion  Apple: $307 billion

7.  Marketing rights  A contractual agreement to market a product or brand in exchange for money. Agreement states how you would market a brand. Must comply with marketing authorities  Copyrights  the exclusive legal right arising from a contract, given to the originator for a fixed number of years, to print, publish, perform, film, or record literary, artistic, or musical material. Copyright law in place to ensure that contract is legally enforceable  Computer software

8.  Must meet the definition and recognition criteria of an asset  FEB generated by trademarks would be?  How can you determine whether FEB are probable?

9.  An Asset  “is a resource”  “Controlled….”  “…From which FEB will flow to the entity”

10.  Intangible assets are initially recognised at?  COST

11.  What is subsequent measurement?  Measurement of intangible assets at the reporting date.  On each reporting date intangible asset will be recognised at:  Cost- accumulated amortisation- accumulated impairment  Accumulated amortisation means?

12.  How to calculate Amortisation?  Make use of straight line method (like depreciation)  Remember:  Trademarks have a limited life with no residual value  Accounting software have a limited life with a residual value.  Intangible Assets should also be tested for impairment  What is impairment?

13.  Upon acquisition of a Trademark/computer software the life of the asset must be estimated making reference to facts and circumstances at that point in time  Life is reviewed annually  If life is no longer sufficient due to change in information/circumstances, it may be revised.  Change in estimate will impact the amortisation of the current and future periods  How to calculate new amortisation based on new life?

14.  Why do trademarks have a limited life?

15.  SFP  Non-current Assets.  Will be held for a period of more than 12 months  SPL  Amortisation, Impairment, loss on disposal presented as Distribution, Admin and other expenses  Profit on disposal presented as other income

16.  Accounting policy (p.664)  Notes (p.665)