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Intangible assets are defined as those non-monetary assets that cannot be seen, touched or physically measured and which are created through time and/or effort. There are two primary forms of intangibles - legal intangibles (such as trade secrets (e.g., customer lists), copyrights, patents, trademarks, and goodwill) and competitive intangibles (such as knowledge activities (know-how,knowledge), collaboration activities, leverage activities, and structural activities). Legal intangibles generate legal property rights defensible in a court of law. Competitive intangibles, whilst legally non-ownable, directly impact effectiveness, productivity, wastage, and opportunity costs within an organization - and therefore costs, revenues, customer service, satisfaction, market value, and share price. Human capital is the primary source of competitive intangibles for organizations today. Competitive intangibles are the source from which competitive advantage flows, or is destroyed. In business and accounting an asset is anything owned, whether in possession or by right to take possession, by a person or a group acting together, e. ...
A trade secret is a formula, practice, process, design, instrument, pattern, or compilation of information used by a business to obtain an advantage over competitors within the same industry or profession. ...
Articles with similar titles include copywrite. ...
A patent is a set of exclusive rights granted by a state to a patentee (the inventor or assignee) for a fixed period of time in exchange for the regulated, public disclosure of certain details of a device, method, process or composition of matter (substance) (known as an invention) which...
A trademark or trade mark[1] is a distinctive sign of some kind which is used by an individual, business organization or other legal entity to uniquely identify the source of its products and/or services to consumers, and to distinguish its products or services from those of other entities. ...
Goodwill means simply to have the will to do good in a community, or, to simply try to help people who are in need (for example, serving at a soup kitchen or at a homeless shelter). ...
Procedural knowledge or know-how is the knowledge of how to perform some task. ...
Personification of knowledge (Greek Επιστημη, Episteme) in Celsus Library in Ephesos, Turkey. ...
Human capital is a way of defining and categorizing the skills and abilities as used in employment and as they otherwise contribute to the economy. ...
In marketing and strategic management, sustainable competitive advantage is an advantage that one firm has relative to competing firms. ...
The Uniform Commercial Code (Section 9-102(a)(42)) defines "general intangibles" as The Uniform Commercial Code (UCC or the Code) is one of a number of uniform acts that have been promulgated in conjunction with efforts to harmonize the law of sales and other commercial transactions in 49 states (all except Louisiana) within the United States of America. ...
- "any personal property...other than accounts, chattel paper, commercial tort claims, deposit accounts, documents, goods, instruments, investment property, letter of credit rights, letters of credit, money, and oil, gas, or other minerals before extraction. The term includes payment intangibles and software."
Personal property is a type of property. ...
Computer software (or simply software) refers to one or more computer programs and data held in the storage of a computer for some purpose. ...
Research & Development
Millions are spent each year by corporations to research and develop new intangible assets. To protect their research and development (R&D) efforts, corporations generally rely on intellectual property law. The phrase research and development (also R and D or R&D) has a special commercial significance apart from its conventional coupling of scientific research and technological development. ...
In law, particularly in common law jurisdictions, intellectual property is a form of legal entitlement which allows its holder to control the use of certain intangible ideas and expressions. ...
Financial accounting
General standards The Financial Accounting Standards Board (FASB) offers some guidance as to how intangible assets should be accounted for in financial statements. In general, legal intangibles that are developed internally are not recognized and legal intangibles that are purchased from third-parties are recognized. The Financial Accounting Standards Board (FASB) is a private, non-for-profit organization whose primary purpose is to develop Generally Accepted Accounting Principles in the United States (US GAAP). ...
Financial statements (or financial reports) are a record of a business financial flows and levels. ...
Expense recognition Intangible assets are typically expensed according to their respective life expectancy.[1] Intangible assets have either an identifiable or indefinite useful life. Intangible assets with identifiable useful lives are amortized on a straight-line basis over their economic or legal life, whichever is shorter. Examples of intangible assets with identifiable useful lives include copyrights and patents. Intangible assets with indefinite useful lives are reassessed each year for impairment. If an impairment has occurred, then a loss must be recognized. An impairment loss is determined by subtracting the asset's fair value from the asset's book/carrying value. This impairment loss may only be reversed under certain circumstances. Trademarks and goodwill are examples of intangible assets with indefinite useful lives. Amortization may refer to: Amortization (business), the allocation of a lump sum amount to different time periods. ...
Loss has several meanings including: Loss in electronics is the ratio of the system output to system input In electronics, loss is the ratio of system output to system input. ...
References - ^ International Accounting Standards IAS38
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