1.263(a)-4, which requires the capitalization of intangible assets
. Generally, a taxpayer is required to capitalize:
Two newer techniques that some consider a better estimate of intangible assets
are the replacement method, which estimates the costs of starting the practice over again in the current market, and the excess earnings method, which measures how far above average your practice's earnings (and thus its overall value) are.
Since January 2014, FASB has issued several significant pronouncements on business combinations and intangible assets
; however, the interaction between the two remains complex, leading to several related questions and concerns: What is the current practice of recognition and measurement for intangible assets
in a business combination?
Even though intangible assets
are not widely accepted as collateral, there does remain a trend in the US market to lend against these types of assets.
Besides the costs and benefits of disclosing information about intangibles, a supplementary question could arrive as regards the determinants of intangible assets
valuations prepared for both financial reporting and transfer pricing purposes often utilize an Income Method.
If a reporting unit's or indefinite-lived intangible asset
's fair value has recently been close to its carrying amount, then the lack of cushion may create alternative views about the results of the qualitative assessment.
* Intangible asset
value: $133.1 billion (81 percent of market value)
This new context has contributed to the rising importance of intangible assets
such as brands, patents, training costs, R&D costs, organisational competences, etc.
One sign of hope is the emerging practice of providing funding to companies on the basis of their intellectual property (IP) and other intangible assets
. Although IP, effective management, worker know-how, and business methods are widely recognized for their role in propelling the growth of the U.S.
The intangible assets
evaluation problem is immensely complicated and disputable.
This approach assumes that no buyer would pay more than the cost to create a similar intangible asset
. The availability or scarcity of similar products in the marketplace affect the cost, and external factors can cause the cost to rise or fall.