Accounting for Intangible Asset
The recognition of intangible assets has been one of the most important factors that have a huge impact on the financial statement. The accounting standards that have been developed provide the basis on which the expenses incurred have to be considered. There have been changes in the accounting standards and the adoption of International Accounting Standards has resulted in different ways in which the treatment of intangible assets is done. This has led to inconsistencies in which the firms accommodate the expenses in the financial statements. Based on the case study of Pics Ltd, the report has been prepared highlighting the following aspects related to intangible assets
Main features of an intangible asset, as laid out in AASB 138 Intangible Assets
1.Treatment of intangible assets based on business and accounting rationales
2.Reforms for current reporting practices for intangibles
3.Various proposals for the reform of accounting for intangibles in Anglo-American and European countries
The report thus provides the complete clarity on how the treatment of intangible assets has to be done and what are the issues that are being faced.