The Phoenix brand was purchased 10 years ago for $100,000. It was attributed
an indefinite useful economic life and has therefore not been amortised. No
impairments have been charged to-date. The directors believe that recognizing the
brand at cost materially under-states the value of the business and therefore
misleads the shareholders and lenders. The directors have prudently valued the
brand at $3 million and wish to recognise this value in the statement of financial
position as at 31 December 20X1.
Is this an intangible asset?
ACCA Ethics & Professional Skills Module
How is this financial issue should be accounted in the Financial statements?
3y ago#1Welcome to my forum - but this is the EPSM forum - not a financial reporting forum.
A purchased brand is (of course) an intangible asset - but it cannot be revalued (IAS 38) because it is unique - so it doesn't have an active market.
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