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Hi tutor, I don’t know to to distinguish between Financial Assets and Intangible Assets.
When I look into the Q3b Jun 2015, the patent right looks like intangible assets to me, but that’s not what the answer suggests.
Are there any keywords that I should pay attention to, so I know what is it when I look at the questions ?
Thanks
Hi,
I believe that you know the difference but have gotten confused with the question. In the first bit we have sold the intangible and are looking at the accounting treatment of the sale, being the receipt of shares (a financial asset).
In the second bit we’ve bought the patent so yes we’ve an intangible but the issues is that of the issue of our shares in exchange for the purchase of the intangible. This is a share based payment.
Hope this helps.
Thanks
Patents and Trademark or other similar intangible assets seems to satisfy “right to recieve cash” how do we distinguish in that case?
For patents and trademarks there is no contractual right to receive cash. We expect an increase in economic benefits but there is no contractual right to receive these benefits.
Thanks
Hi tutor, thanks for your reply.
For the first bit, if the question revised to sell the patent right in exchange of cash, we will use IFRS5 , right ?
The reason to use IFRS9 in the question because the equity investment falls into the scope of it
Please correct me if I’m wrong.
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