Management, Work and Society - Essay Example

It also gives an idea of about when and how the recognition and measurement of intangibles assets are done in a business corporation. Further it also elaborates the condition needed to be an intangible asset. The paper thoroughly describes elements associated with intangible assets like why corporations purchase or internally develops them and what are the examples of intangible assets. Furthermore the paper describes value of intangible assets for a business corporation. Nowadays it is a very sensitive area regarding accounting of intangible assets in a business combination.

Further it also shows the importance intangibles assets held by the acquiree’s business while going for business combination. It also describes the growing importance of the various types of intangible assets like human resources, technology & etc. It also helps us to understand the basis of valuation of an intangible asset in the context of sports players in corporate teams. It highlights the trend of buying sports teams by the corporate houses and naming them after their name. These corporate houses treat these sports teams and their players as intangible and their valuation is major concern for them (Cohen 2011).

Intangible assets Intangible assets can be defined as non-monetary assets which cannot be seen, touched or measured physically. These are identified as separate assets and are created through time or efforts. Hand and Lev (2003) has stated that intangibles can be identified in two basic forms viz. legal intangibles and competitive intangibles. Legal intangibles comprises of copyrights, patents, trademarks whereas competitive intangibles comprises of various activities related to the acquisition of knowledge , various collaboration activities, leverage activities, various structural activities, human capital, competitive advantage etc.

Legal tangibles are generally called as intellectual property and the one who possess these assets have the legal right to defend these assets in the court of law. On the other hand competitive intangible assets cannot be owned legally but are of great importance. It has a direct influence on the effectiveness, productivity, costs, revenue, customer satisfaction, market value and overall performance of an organization (Hand and Lev 2003). Intangible assets can also be categorized as the one that are being included for the accounting purposes and are included in the balance sheet of the companies.

Such intangible assets include licenses and patents, purchased goodwill and capitalized R&D costs. The other category includes the intangible assets that are not being considered while accounting and are considered assets from the economics perspective. Various intangible assets that are generally excluded under accounting rules includes staff training, brand value, the development of IT systems, and customer networks. As per IAS 38 an intangible asset other than goodwill can be defined as non-monetary asset which do not have any physical substance.

An asset can be recognized as intangible asset only if it is expected to yield future economic benefits and