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1)If license given for 5yrs and after that it can be renewed through nominal amount .
In such case either the amount to be given for renewal would be added in license cost at intial recognition or it will be expensed when incurred.
2)License acquired and its is expected that its value vl increase due to market condition
Can we increase the value of intangible assets purly because of market condition or not.Where the probability is that an extension at a nominal value will be taken up, the cost of the nominal value should be included within the lease calculations. However, given that the value IS nominal – it’s hardly likely to have a material affect on the figures.
No, you cannot recognise the potential increase in the value of an intangible non-current asset merely because of expectations. Whatever happened to your “prudence” concept!
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