Wiley IFRS: Practical Implementation Guide and Workbook, 3rd Edition

Chapter 29

INTANGIBLE ASSETS (IAS 38)

INTRODUCTION AND BACKGROUND

The purpose of this Standard is to prescribe the recognition and measurement criteria for intangible assets that are not covered by other Standards. This Standard will enable users of financial statements to understand the extent of an entity’s investment in such assets and the movements therein.

The principal issues involved relate to the nature and recognition of intangible assets, determining their costs, and assessing the amortization and impairment losses that need to be recognized.

SCOPE

The Standard is to be applied in accounting for all intangible assets except

• Those that are within the scope of another Standard

• Financial assets as defined in IAS 32, Financial Instruments: Presentation

• Mineral rights and expenditure on the exploration for, or development and extraction of, minerals, oil, natural gas, and similar nonregenerative resources

The Standard does not apply to those intangible assets covered by other Standards, such as

• Intangible assets held for sale in the ordinary course of business (IAS 2)

• Deferred tax assets (IAS 12)

• Leases within the scope of IAS 17

• Assets arising from employee benefit plans (IAS 19)

• Financial assets covered by IAS 32, IAS 27, IAS 28, or IAS 31

• Goodwill acquired in a business combination (IFRS 3)

• Deferred acquisition costs and intangible assets arising from insurance contracts (IFRS 4) (However, the disclosure requirements for such intangible assets are applicable) ...