Myassignment.live is not sponsored or endorsed by this college or university
As per paragraph 9 of AASB 138, it is suggested that the some of the frequent methods in which an entity incurs its expenditure is the acquisition of brand titles and trademarks among others. As stated in Paragraph 63 of the Standard, subsequent expenditure on aspects like brands, publishing titles and customer heads is required to be expensed. It is because of the difficulty in separating this expenditure from the expenditure of the business as a whole. Another difficulty lies in the process of recognising a brand separately from a group of brands acquired by the business. This is especially true when the brands acquired as a part of a business combination tend to different useful lives from each other. Internally generated brands are also not recognised as an intangible asset by the business because of the difficulty involved in recognising their contribution towards the growth of the business. Another issue related to the brands is the lack of a unique market as stated in the Paragraph 78 of AASB 138. Due to the unique nature of brands, they are not actively traded in the market like other assets and inventory of the business. Even though transactions related to brands occur between individuals, the rate at which they happen is extremely infrequent. Hence, the prices which are paid by one entity to another entity cannot be stated as being correct because of the absence of fair values in the market. The above mentioned factors are some of the reasons or the difficulties faced by the Standard setters in allowing the recognition of all brands and trademarks in the statement of financial position of an entity.
Aasb.gov.au. (2020). [online] Available at: https://www.aasb.gov.au/admin/file/content105/c9/AASB138_08-15_COMPoct15_01-18.pdf [Accessed 16 May 2020].
Aasb.gov.au. (2020). [online] Available at: https://www.aasb.gov.au/admin/file/content102/c3/AASB136_07-04_ERDRjun10_07-09.pdf [Accessed 16 May 2020].
Aasb.gov.au. (2020). [online] Available at: https://www.aasb.gov.au/admin/file/content105/c9/AASB137_07-04_COMPjun14_04-14.pdf [Accessed 16 May 2020].
Studiapodyplomowe.pl. (2020). [online] Available at: https://studiapodyplomowe.pl/uploads/import/kozminski/pl/default_aktualnosci/168/511/1/baruch_overpriced_shares,_ill-advised_acquisitions,_and_goodwill_impairment.pdf [Accessed 16 May 2020].
To export a reference to this article please select a referencing stye below:
My Assignment Help. (2022). Accounting Principles II. Retrieved from https://myassignment.live/free-samples/acct2023-accounting-principles-ii/financial-statements-of-the-business-file-A1D39FE.html.
"Accounting Principles II." My Assignment Help, 2022, https://myassignment.live/free-samples/acct2023-accounting-principles-ii/financial-statements-of-the-business-file-A1D39FE.html.
My Assignment Help (2022) Accounting Principles II [Online]. Available from: https://myassignment.live/free-samples/acct2023-accounting-principles-ii/financial-statements-of-the-business-file-A1D39FE.html
[Accessed 06 September 2022].
My Assignment Help. 'Accounting Principles II' (My Assignment Help, 2022) < https://myassignment.live/free-samples/acct2023-accounting-principles-ii/financial-statements-of-the-business-file-A1D39FE.html> accessed 06 September 2022.
My Assignment Help. Accounting Principles II [Internet]. My Assignment Help. 2022 [cited 06 September 2022]. Available from: https://myassignment.live/free-samples/acct2023-accounting-principles-ii/financial-statements-of-the-business-file-A1D39FE.html.
Are you confident that you will achieve the grade?
Our best Expert will help you improve your grade
If you are the original writer of this content and no longer wish to have your work published on Myassignment.live then please raise the content removal request.