A few points about intangible fixed assets;
Regarding intangible assets, it should be said that at the time of registration of its expiration (depreciation), instead of accumulated depreciation, the asset account itself is credited, and also that the value of intangible assets is zero in most cases.
A copyright is a right that allows the holder to produce and sell a certain product. The maximum life of the franchise is 17 years.
Copyright (copyright or copyright) is the exclusive right to publish and sell books, music compositions, films and other artistic products, copyright also includes computer software. The maximum copyright life is 50 years.
The cost of acquiring copyright from the government is usually low and cheap, but if it is purchased from the owner, it is usually expensive. Since the useful life of copyright usually does not exceed two or three years, the amount of expiration (depreciation) of this intangible asset each period includes a large part of its cost price.
Note: The Law on the Protection of Authors, Authors and Artists defines copyright as follows: Copyright is the exclusive right to publish, distribute, offer and perform an artistic work or writing that lasts for the lifetime of the creator and thirty years after the death of the creator. His heir is granted.
Trademarks and brand names are distinctive features of products and services. Article 1 of the Trademarks and Inventions Registration Law defines a trademark as follows: any type of mark, including a pattern, image, number, letter, phrase, seal, wrapper, etc., that is used to mark and distinguish an industrial or commercial or industrial product. .
The cost of trademarks and trade names must be amortized over their useful life, which is a maximum of 40 years. Expenses spent on advertising and promotion of trademarks should not be included as part of the cost of assets, but should be recorded as current expenses under advertising expenses.
Exclusively selling (franchise) the seller of royalties, trademarks and . During a service contract, it provides instructions and technical assistance to buyers in a certain period. The cost price of the exclusive sale must expire in a period that lasts a maximum of 40 years.
Long-term leases are an agreement based on which the lessor gives the right to use an asset to the lessee in exchange for rent and for an agreed period. These types of lease contracts are of two types: operational lease and capital lease. In operating lease contracts, the benefits and risks of property ownership are transferred to the lessee, and he is obligated to return the leased item to the owner at the expiration of the lease term.
In capital lease contracts, if the lessee spends during the lease period to repair and improve the leased item with the intention of making more profit, these expenses, considering that the leased item will eventually be returned to the owner, are a type of intangible asset for the lessee. It creates that it should be registered as an asset with a suitable title such as the expenses of improving the rental property and depreciated during the lease period or the useful life of the improvement, whichever is shorter.
Goodwill in accounting should not be recognized and recorded as the excess of the purchase price of a commercial unit over the total market value.
2. According to accepted accounting principles, goodwill should be depreciated in a period that should not exceed 40 years. Although in the real world, the value of goodwill is increasing moment by moment, but the Accounting Standards Board has required business entities to depreciate the cost of all intangible assets.
Mehdi Koh Soltani (financial services, accounting, financial and tax consultant):
The group of accountants and auditors of Tabriz
@Hesabdaran_Tabriz
@Hesabdaran_Tabrizz