Ias / Ifrs Vs Us Gaap

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Brianna Martin May 4, 2016 Dr. Serrano-Garcia ACCT 4270-01 IAS/IFRS vs. US GAAP: IAS 38 IAS 38 is an accounting standard regarding intangible assets. It supplies accounting rules for intangible assets that are purchased, acquired in a business combination, and internally generated. According to Investopedia, intangible assets are nonmonetary assets without a physical presence, that have useful lives greater than one year. This type of asset is held for use in the production of goods or services, for rental to others, or administrative purposes. Examples of intangible assets include trademarks, customer lists, licensing agreements, service contracts, etc. Brand name…show more content…
Costs incurred during the planning stage should be recognized as an expense when incurred. Application and infrastructure development, graphical design, and content development stages are closely related to the development phase of IAS 38.57 which states, “Development costs are capitalized only after technical and commercial feasibility of the asset for sale or use have been established.” Expenditures induced during the stated stages should be covered in the total cost the website and recognized as an intangible asset when the cost can be instantly allocated on a reliable and consistent basis. Costs incurred in the content development stage should be recognized as expenses as incurred in accordance with IAS 38.69. The following are some costs identified by IAS 38.69 to be expensed: start-up, pre-opening, pre-operating, training, and relocation costs. Expenses incurred in the operating stage are treated the same way. Purchased intangibles are originally valued at cost. The useful life of this asset is considered finite or indefinite. The residual value is presumed to be zero unless certain circumstances occur. The asset’s useful life is deemed indefinite when there is no estimable limit to the period over which it is expected to generate cash flows for the entity. An asset with an indefinite life requires no amortization until the life is determined to be definite. Under IAS 38 and U.S. GAAP, intangibles acquired in a business
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