Australian Accounting Standard 138 | Report

Running head: AASB 138
AASB 138
Name of the Student:
Name of the University:
Author Note:

AASB 1381
Table of Contents
Introduction:...............................................................................................................................2
Discussion:.................................................................................................................................2
Meaning of AASB 138 / IAS 38:...........................................................................................2
Coverage of assets under this standard:.................................................................................3
Criteria for Recognition of the Intangible Assets:.................................................................3
Valuation of the intangible assets:.........................................................................................5
How to determine Amortization of the asset:........................................................................6
Accounting discrepancy in the valuation of internally generated asset and acquired asset:..6
Conclusion:................................................................................................................................8
References:.................................................................................................................................9

AASB 1382
Introduction:
In this report the Australian accounting standard 138 is discussed in regards to its
impact on the treatment of the internally generated intangibles and acquired intangibles. The
meaning of the standard AASB 138 is discussed in this report. Also the definition of the
intangibles which are accounted under this standard is discussed in this report. The
measurement of value of the intangibles which are acquired or generated is highlighted in this
report (Russell, 2017). The valuation of the intangibles after they have been recognized is
discussed in this report. Finally the differences which arise due to the different valuation
treatment of intangibles which are internally generated and which are acquired is highlighted
in this report. The issues which are created due to this accounting difference is discussed and
the impact of the difference is analysed. Thus at the end of this report a conclusion is based
on the accounting standard which summarises all the discussion which is presented with in
this report (Steenkamp & Steenkamp, 2016).
Discussion:
Meaning of AASB 138 / IAS 38:
The AASB 138 / IAS 38 is an accounting standard in the Australian Accounting
standard board which applies to the identification, measurement of the intangible assets
which are not covered in any other standards. Thus the accounting of the various intangible
assets is done as per the rules which are prescribed in this accounting standard. The intangible
assets need not be covered by any other accounting standards and then only the provision of
this standard are applicable to the intangible assets of the company (Su, & Wells, 2018).

AASB 1383
Coverage of assets under this standard:
All the intangible assets of the company whether internally generated or acquired
through business combination is covered under this standard with the few exceptions
highlighted in the following points.
 The assets which are generated during the exploration and mining of non-renewable
energy resources.
 Assets which fall under the accounting standards AASB 132 / IAS 32 related to
financial accounts presentation.
 Assets which are intangible but are covered under the provisions of another
accounting standards. Hence they are not covered under the accounting standard
AASB 138 / IAS 38 (Tran, & Zhu, 2017).
Criteria for Recognition of the Intangible Assets:
The criteria for the recognition of the assets to be intangible needs to fulfil the
following criteria to be identified as intangible assets.
 The assets should be able to complete the meaning or definition of intangible assets
which involves the assets to be recognised, the company has a control over the assets
and economic benefits from the assets is possible in the future.
 The assets can be recognised as intangible assets only if the future economic benefit
from the asset will flow or be earned by the company. Also the cost of the asset of the
company can be measured accurately (Sharma, & Dharni, 2019).
If the assets are internally generated by the firm they can be only recognized when the
entity classifies the generation of the asset either as research phase or as development phase.
Thus the assets which are classified in the research phase are excluded to be identified as