Intangible assets and creative impairment - an analysis of current disclosure practices by large Australian listed firms

Nigel Finch

Intangible assets and creative impairment - an analysis of current disclosure practices by large Australian listed firms

Nigel Finch

Macquarie Graduate School of Management

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Abstract

This paper examines the disclosure of intangible assets by ‘high user’ industrial firms in the Australian market subsequent to the introduction in 2005 of AASB 136 and AASB 138. Using a sample of ten large industrial firms with combined intangible assets of $37,758 million as at 2006, the paper analyses the disclosure of goodwill and 18 other distinct intangible assets classes of these firms, and examines their implied effective life by probing the impairment expense detailed in the profit and loss statement. While a high degree of uniformity in disclosure practices pertaining to intangible assets is evident, questions are raised in relation to factors motivating impairment decisions for intangible assets under the new financial reporting regime.

Original language	English
Pages (from-to)	18-24
Number of pages	7
Journal	Journal of law and financial management
Volume	5
Issue number	2
Publication status	Published - 2006

Bibliographical note

Publisher version archived with the permission of the publisher Macquarie Graduate School of Management, Macquarie University, NSW, Australia. This archived copy is available for individual, non-commercial use. Permission to use this version for other uses must be obtained from the publisher.

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Cite this

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author = "Nigel Finch",

note = "Publisher version archived with the permission of the publisher Macquarie Graduate School of Management, Macquarie University, NSW, Australia. This archived copy is available for individual, non-commercial use. Permission to use this version for other uses must be obtained from the publisher.",

year = "2006",

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PY - 2006

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N2 - This paper examines the disclosure of intangible assets by ‘high user’ industrial firms in the Australian market subsequent to the introduction in 2005 of AASB 136 and AASB 138. Using a sample of ten large industrial firms with combined intangible assets of $37,758 million as at 2006, the paper analyses the disclosure of goodwill and 18 other distinct intangible assets classes of these firms, and examines their implied effective life by probing the impairment expense detailed in the profit and loss statement. While a high degree of uniformity in disclosure practices pertaining to intangible assets is evident, questions are raised in relation to factors motivating impairment decisions for intangible assets under the new financial reporting regime.

AB - This paper examines the disclosure of intangible assets by ‘high user’ industrial firms in the Australian market subsequent to the introduction in 2005 of AASB 136 and AASB 138. Using a sample of ten large industrial firms with combined intangible assets of $37,758 million as at 2006, the paper analyses the disclosure of goodwill and 18 other distinct intangible assets classes of these firms, and examines their implied effective life by probing the impairment expense detailed in the profit and loss statement. While a high degree of uniformity in disclosure practices pertaining to intangible assets is evident, questions are raised in relation to factors motivating impairment decisions for intangible assets under the new financial reporting regime.

M3 - Article

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JO - Journal of law and financial management

JF - Journal of law and financial management

IS - 2

ER -

Intangible assets and creative impairment - an analysis of current disclosure practices by large Australian listed firms

Abstract

Bibliographical note

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