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Intangible Assets – IAS 38

21 April 2009 4,259 views 5 Comments

Dear Group member

Please advice, the rent which is paid for the advertiment, like display of bill boards etc., can we take it into intangible assets.

Is advertisment cost of our product an intangible assets

Best Regards
Suraj

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5 Comments »

  • admin (author) said:

    Message from Chinnsamy

    Dear Suraj,

    The rent on hoarding, even if it brings out enduring benefits for branding will be treated as an Intangible “Item” and not “Intangible Asset” and has to be charged off to revenue. IAS 38 does not permit recognising internally generated goodwill, brands etc.,

    With regards
    Chinnsamy

  • admin (author) said:

    Message from Edgar

    Dear Suraj,

    Rent on hoarding, which is an intangible assets is to be matched off with the revenue, not as an intagible assets.

    Edgar

  • admin (author) said:

    Dear Suraj,

    IAS 38 para 69 clearly prohibits capitalization of expenditure on advertising and promotional events

    This is because we cannot reasonably attribute incremental contribution to the advertising and promotional events in determining the Value-in-use of the expenditure.

    Regards

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