Intangible Assets Research Project

Date recorded:

The purpose of the session was to seek the Board's agreement with the scope and approach and the project plan. The project is led by the Australian Accounting Standards Board (AASB). The AASB staff presented the intended scope and approach and the draft project plan.


The project is an IASB project, with FASB being kept informed of progress, rather than a joint IASB/FASB project.


The AASB staff identified the following topics that could be the subject of this research project.

  • Topic A: Initial accounting for intangible assets acquired other than in a business combination (internally generated and separately purchased intangible assets)
  • Topic B: Initial accounting for intangible assets acquired in a business combination
  • Topic C: Subsequent accounting for intangible assets
  • Topic D: Initial and subsequent accounting for goodwill

The AASB staff identified Topic A as the most suitable as a focus for the purposes of the Memorandum of Understanding (MoU), that is, achieving improvements to current requirements in the short term. This is mainly because the requirements for internally generated assets have not been subject to review for some time.

Topic B was considered not be a suitable topic for the Intangible Assets research program since this topic has been subject to relatively recent review as reflected in IFRS 3 Business Combinations and SFAS 141 Business Combinations.

Topic C was considered also to have potential to improve current requirements, but the AASB staff was of the opinion that improvement was unlikely to be achievable in the short term.

Topic D was excluded because of the degree to which current accounting for acquired and internally generated goodwill is entrenched under both IFRSs and US GAAP.

Accordingly, staff was suggested that the project should focus on Topic A comprising definition/identification, recognition, measurement, and disclosure/presentation with a particular emphasis on issues relating to identification and measurement.

Board members noted that the project should include Topic C, since Topics A and C interact, and improvements on both issues are required in the short term. The Board asked the AASB staff to prepare a discussion paper by January 2007.

Next steps

The Board intends to discuss the project again at the beginning of 2007 before making a final agenda decision.

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