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Hello Tutor,
Could you please help me in understanding this statement?
”The useful life of an intangible asset reflects only that level of future maintenance expenditure required to maintain the asset at its standard of performance assessed at the time of estimating the asset’s useful life, and the entity’s ability and intention to reach such a level. A conclusion that the useful life of an intangible asset is indefinite should not depend on planned future expenditure in excess of that required to maintain the asset at that standard of performance.”
Thanks.
If you buy a brand with a life of 10 years, amortise it over 10 years. Although spending money on the brand might increase the life, this should not be taken into account.
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