This Report Has Been Written To Analyse The Financial Statements

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.

Intangible assets that are developed via ongoing business process and internally, are not reported on the corporate accounts.

Goodwill is an intangible asset, probably the most intangible of all intangible assets, hard to measure and even more difficult to account for. Goodwill today constitutes a much larger part of acquisition prices than it did previously, resulting in a much greater impact on financial statements.

Generally, Assets that do not have a definite existence are called intangible assets. AASB Australian accounting standards board 138 defines an intangible asset as an identifiable non-monetary asset lacking physical substance. It is a claim to future benefits that does not have a financial example. There are three main features of intangible asset as laid by AASB138.They are:

Companies consist of both intangible and tangible assets and each has an impact on the success of the company. The tangible assets are things that you can physically see. Examples include buildings, inventories, and equipment. Intangible assets are the assets that you cannot see or touch like money, intellectual property, patents, company reputation and human capital (Lev,2004). Human Capital consists of employees and their skills and

Goodwill is seen as an intangible asset on the balance sheet because it is not a physical asset such as buildings and equipment. Goodwill typically reflects the value of intangible assets such as a strong brand name, good customer relations, good employee relations and any patents or proprietary technology.

However, there is difficulty in assigning values to intangible assets because they have no physical form. Some companies even neglect recognition in their financial statements.

By immediately writing off purchased goodwill the company makes the treatment of goodwill equitable throughout the company. As inherent goodwill is not shown as a direct asset in the usual balance sheet it seems contradictory and inconsistent to record purchased goodwill. In addition, as it is not possible to realise goodwill independently of the company and it cannot be attributed a capital worth in a liquidation it seems unrealistic to record goodwill as an asset in the balance sheet. This would also suggest that amortisation of the intangible asset over any period should not be deferred and attributed to any future income.

According to Harold Averkamp (2015), Goodwill is reported on the balance sheet as a noncurrent asset.

The amount is clearly not subjective or estimated. Elliott and Elliott (2007, p.454) consider the income statement ramifications in that by failing to account for the loss in value of goodwill here, a company would be ignoring the fact that goodwill loses value over its entire life.

Goodwill is an asset that is an intangible asset. Goodwill represents the future economic benefits that arise from acquiring assets during a business amalgamation. A goodwill reflects the difference between the purchase price and the fair value of acquiring a company’s assets or a business merger. According to the generally accepted Accounting Principle goodwill is not amortized. Therefore, on the balance sheet there would not be an accumulated goodwill amortization. Impairment on a goodwill is tested annually or whenever issues arise. Note, if an impairment has occur the amount will be written down as an increase to the goodwill valuation account.

No intangible asset arising from research (or from the research phase of an internal project) shall be recognised. Expenditure on research (or on the research phase of an internal project) shall be recognised as an expense when it is incurred.

Intangible assets are those assets that are not visible but can be measured and add to the profitability of the organization.In most companies and organizations, the intangible assets are greater than the tangibles.There are three types of intangible assets, all derived from people.(All assets and organizational structures are the result of human actions). The three types are:

Companies always have different kinds of assets, such as buildings and machines, but they also have some other assets like brand names, research and development, copyrights or patents. These assets contain three essential characteristics: they are assets, they lack physical substance and they are identifiable non-monetary. This kind of asset is called intangible asset. It can be recognized if it can meet these four criteria: it is separately identifiable, controlled by the enterprise, the expected future economic benefits will flow to the entity and the cost of the assets can be measured reliably. The fair value and validity of the intangible assets and the supply and demand in intangible assets market must be

Yes, because 4 biggest players which are The Walt Disney Company,Time Warner’s Six Flags Corporation, Paramount, Anheuser Busch and Cedar Fair have together more than 80% of market share.