Question: How Does Ias 38 (intangible Assets) Differ From U.S. Gaap With Respect To Development Costs?

IAS 38 states that an intangible asset is deemed to have an indefinite life when there is no foreseeable end to the expected cash flows the asset is likely to generate. U.S. GAAP does not allow capitalization of development costs, whereas IAS 38 allows capitalization of these costs.

How does the definition of asset impairment differ between IAS 36 and U.S. GAAP?

U.S. GAAP considers cash flows in assessing value of continued use, but does not discount them, whereas IAS 36 requires discounting in assessing asset impairment.

Under what circumstance both U.S. GAAP and IAS 2 will provide similar result with respect to inventory valuation?

Under what circumstances, both GAAP and IAS 2 will provide similar results with respect to inv. val. when replacement cost is greater than net realizable value.

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How are intangibles accounted under U.S. GAAP and IFRS?

Intangibles Under IFRS, intangible assets are only recognized if they will have a future economic benefit. In such a way, the asset can be assessed and given a monetary value. On the other hand, GAAP recognizes intangible assets at their current fair market value, and no additional (future) considerations are made.

How are internally generated intangibles handled under IFRS How does this differ from U.S. GAAP?

How are internally generated intangibles handled under IFRS? Research expenditures are expensed as incurred. Development expenditures are recognized as an intangible asset when six criteria are met. Under U.S. GAAP, research and development costs are expensed as incurred.

What are the three major types of intangible assets?

Intangible assets include patents, copyrights, and a company’s brand.

Which impairment losses should never be reversed?

An impairment loss for goodwill is never reversed. For other assets, when the circumstances that caused the impairment loss are favourably resolved, the impairment loss is reversed immediately in profit or loss (or in comprehensive income if the asset is revalued under IAS 16 or IAS 38).

What are the similarities and differences between GAAP and IFRS?

GAAP vs. IFRS. A major difference between GAAP and IFRS is that GAAP is rule-based, whereas IFRS is principle-based. With a principle based framework there is the potential for different interpretations of similar transactions, which could lead to extensive disclosures in the financial statements.

What are the main similarities between IFRS and U.S. GAAP?

Both US GAAP and IFRS recognize fixed assets when purchased, but their valuation can differ over time. US GAAP requires that fixed assets are measured at their initial cost; their value can decrease via depreciation or impairments, but it cannot increase.

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Which of the following is a difference between IAS 37 and U.S. GAAP with respect to restructuring provisions?

Which of the following is a difference between IAS 37 and U.S. GAAP with respect to restructuring provisions? U.S. GAAP does not allow recognition of a restructuring provision until a liability has been incurred.

What costs can be capitalized under US GAAP?

GAAP allows companies to capitalize costs if they’re increasing the value or extending the useful life of the asset. For example, a company can capitalize the cost of a new transmission that will add five years to a company delivery truck, but it can’t capitalize the cost of a routine oil change.

What is intangible assets in US GAAP?

An intangible asset is an asset that is not physical. Examples of intangible assets include a company’s customer lists, brand name, data, or workforce. Under U.S. GAAP, however, most internally generated intangible assets are not recorded on the balance sheet.

Who uses GAAP and IFRS?

IFRS is used in more than 110 countries around the world, including the EU and many Asian and South American countries. GAAP, on the other hand, is only used in the United States. Companies that operate in the U.S. and overseas may have more complexities in their accounting.

How does GAAP treat fixed assets?

In GAAP there is only one way to initially record a fixed asset and that is the cost method. The cost method involves recording the acquisition cost of the fixed asset, plus the costs of bringing the fixed asset to the condition and location required for its use.

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What are examples of intangible assets?

Such an asset is identifiable when it is separable, or when it arises from contractual or other legal rights. Separable assets can be sold, transferred, licensed, etc. Examples of intangible assets include computer software, licences, trademarks, patents, films, copyrights and import quotas.

What are the three major types of intangible assets quizlet?

Major types are: (1) marketing-related intangibles, used in the marketing or promotion of products and serices; (2) customer-related, resulting from interactions with outside parties; (3) artistic-related, giving ownership rights to such items as plays and literary works; (4) contract-related, representing the value

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