Non-Current Assets – Goodwill and Intangible Assets
- AS, A Level
- AQA, Edexcel, OCR, IB
Last updated 22 Mar 2021
Occasionally you will see reference in a balance sheet to "goodwill and intangible assets".
Normally a business cannot recognise in its accounts the value of intangible assets that the business has. These might include:
- The know-how and experience of staff and management
- The value of brands and customer loyalty
- Reputation for quality in the market
The reason for this is simple – any such value is highly subjective, and could easily be manipulated.
There is one exception, however. A business can record in the balance sheet the value of intangible assets that it has actually bought. For example, if it pays £250,000 for the right to use a brand name, then it can record that as an intangible asset at cost
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