Bassett group M/J’18 kaplan kit- part a) i and ii) Transfer of software

Q: "£5 million relates to purchased software [there would be an active market], and £10 million relates to internally developed software [there is NO active market for anything that is unique/one of a kind]"

Such internally-generated "assets" cannot be capitalised in the entity's financial statements - BUT if the entity is purchased, any internally-generated intangible other than goodwill SHOULD be capitalised - you should know - you've studied SBR - assets (and contingent liabilities) are recognised in a business combination so that the amount calculated as purchased goodwill (goodwill in the consolidated financial statements) is as small as possible.