Fair Value Accounting And Intangible Assets - 2641 Words

Fair Value Accounting and Intangible Assets The considerable debate on the advantages and disadvantages of moving towards a full mark to market accounting system for financial institutions has been triggered by the move of the International Accounting Standards Board (IASB) and the US Financial Accounting Standards Board (FASB) to make changes in this direction as part of an attempt to globalize accounting standards. Both fair value accounting and historical cost accounting have their advantages and drawbacks and therefore it is hard to conclude which system is superior to the other. Within the accounting systems, the valuation of intangible assets has been a constant source of attention by the board as well. This essay summarizes the superiority of fair value accounting in measuring value of certain assets and liabilities including intangible assets in light of the IASB discussion paper released recently. According to Rodrà ­guez-Pà ©rez et al (2011) the debate between the choice of Fair value and Historical cost accounting essentially takes root from the debate of relevance and reliability. The IASB Framework defines relevancy as when information â€Å"influences the economic decisions of users by helping them evaluate past, present or future events or confirming, or correcting, their past evaluations.†Reliability as defined by the IASB framework is when information is faithfully represented, prudent, it contains substance over form, it is neutral, and complete. Even though bothShow MoreRelatedAccounting Analysis of Worley Parsons1656 Words   |  7 PagesAccounting Analysis, including: ï‚ · an analysis of the company’s accounting policies that are likely to affect interpretation of its financial reports (at least 3 policies) ï‚ · a comparison to those of a competitor in the same industry. 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It supplies accounting rules for intangible assets that are purchased, acquired in a business combination, and internally generated. According to Investopedia, intangible assets are nonmonetary assets without a physical presence, that have useful lives greater than one year. This type of asset is held for use in the production of goods or services, for rental to others, or administrative purposes. Examples of intangible assets include trademarksRead MoreJohnson Johnson And Johnson1159 Words   |  5 Pagesthe largest health care companies in the world is Johnson Johnson. They now have over 128,000 employees and more than 250 operational subsidiaries located in 60 countries around the world. Johnson Johnson has more than $132.6 billion in total assets. Johnson Johnson’s headquarters, however, is still located in New Brunswick, New Jersey. Jo hnson Johnson research, develop, manufacture, as well as sell health care products all over the world. (Johnson Johnson) Johnson Johnson’s operations