Intangible assets are initially recorded at cost, and are subsequently stated at cost less any
accumulated amortisation and impairment losses. Any intangible assets carried at revalued amounts,
are recorded at the fair value at the date of revaluation, as determined by reference to an active
market, less any subsequent accumulated amortisation and subsequent accumulated impairment
losses.
Intangible assets acquired as part of a business combination are only recognised separately from
goodwill when they arise from contractual or other legal rights, are separable, the expected future
economic benefits are probable and the cost or value can be measured reliably.
Development costs
Research expenditure is written off in the period in which it is incurred.
Development expenditure incurred is capitalised as an intangible asset only when all of the following
criteria are met:
- It is technically feasible to complete the intangible asset so that it will be available for use or sale;
- There is the intention to complete the intangible asset and use or sell it;
- There is the ability to use or sell the intangible asset;
- The use or sale of the intangible asset will generate probable future economic benefits;
- There are adequate technical, financial and other resources available to complete the development and to use or sell the intangible asset; and
- The expenditure attributable to the intangible asset during its development can be measured reliably.
Expenditure that does not meet the above criteria is expensed as incurred.
Amortisation is provided on intangible assets so as to write off the cost, less any estimated residual value, over their useful life over 5 years.