Reporting Intangible Assets- Convergence of Accounting Standard

Abstract

The accounting standards are prepared to maintain uniformity in preparing financial statements so as to make them comparable and comprehensive. In the era of globalisation, operations of a company are not restricted to one single country and hence many organisations today have their stakeholders spread over different nations across different continent. The different accounting standards issued by different countries to prepare financial statements have made it difficult to evaluate the performance of such organisations. It is therefore proposed to converge the accounting standards under one acceptable standard. This research paper aims to evaluate the difference in the reporting standard and its impact on performance evaluation of an organisation, stressing further the need of convergence of accounting standards. Intangible assets today have became an important part of an organisation's resources. There are organisations whose performances are substantially affected by intangible assets they hold. In this context reporting and analysis of intangible assets is crucial for assessing the company's performance and prospects. The proposed study will compare the reporting standards under US GAAP, IFRS and Indian AS, with respect to intangible assets with the aim of finding their impact on reporting of various companies. 'The result of this study will help us to understand the application of various reporting standards on intangible assets and also to assess the need of having common reporting standards. Further it will enable us to assess the adequacy of current reporting standards and scope for their improvement. Keywords: Intangible Assets- US GAAP- IFRS- Indian AS-Similarities and Differences-Intellectual property-Recognition Criteria-hnpainnent-Capitalisation- Estimated Cashflows-Accounting of Patents, Copyrights etc- Internally generated Assets.