Trademarks and patent, Auditing

Trademarks and Patent

Trademarks and then written off over their useful lives and patents may be capitalized along with any renewal fees being charged to revenue. Whether a trade mark or patent is abandoned then the total book amount should be written off directly. Commonly the company should remain a register of all material items that should be determined against the accounting records, and the agreements of third party confirmation from the patent agent of the existence and company's title to the assets. Such auditors will require considering the valuation of the assets.  This will involve a review of the further income arising from the trade mark and patent to see where it specifies the value put on it.  In assessing the future income for further it will be essential to seems the possibility which income will not arise since for example to changes or  expiry in the client's business.

You must recall from your accounting knowledge also for such the goodwill impairment could be determined needing 'bottom-up' or 'top-down' tests.The 'bottom-up' test includes identifying the goodwill in the balance sheet such can be located on a reasonable basis to the cash generating unit. The 'top-down' test includes identifying the smallest cash generating unit such the goodwill concerned and then apportioning any unassigned goodwill on a reasonable basis to the cash producing unit.

In each case above, impairment has happened whether the recoverable amount of the cash producing unit is less than the carrying amount of the assets as like the assigned goodwill.

You must recall from your earlier studies also which the 'top-down' test is essential whereas there is no reasonable basis for carrying out a 'bottom up' test. Management's specification of the procedure of carrying out the impairment review must be carefully examined.  Such the auditor should see the reliability and sufficiency of the evidence obtainable.  Whenever investigative 'value-in-use' or 'economic value' evidence will be essential to support future cash flow projections, growth rates interest rates, future production costs, product life cycle etc.  These are topics areas where find out the 'total selling proceeds' is more simply verifiable through reference to evidence from present market activity.

It is especially essential that the auditor reviews the notice to the financial statements to sure about the disclosures in respect of the accounting policy and treatment is sufficient and suitable.

Posted Date: 1/25/2013 2:30:52 AM | Location : United States







Related Discussions:- Trademarks and patent, Assignment Help, Ask Question on Trademarks and patent, Get Answer, Expert's Help, Trademarks and patent Discussions

Write discussion on Trademarks and patent
Your posts are moderated
Related Questions
Process to Adopt Liabilities It is significant that the auditor realises which such liabilities can exist and he should obtain reasonable steps to unearth them whether they ex

Information in the Fixed Assets Register The register can obtain the following information: i. Fixed asset number. ii. The cost and the date of purchase. iii. Descrip

Verification of Liabilities - Audit Process Usually speaking, the auditor's duty along with regard to liabilities can be summarised follows as: 1. To confirm the existence of


State the FIVE threats contained within Auditor''s Code of Ethics and Conduct and for each threat list ONE example of a circumstance that may create the threat.

A. Board of Directors Best Buy's Board is elected by the shareholders to oversee the business and affairs of the company.  The board counsels, advises and oversees management wi

if a proxy is voted as per his judgement other than member prescribed to him... what is the action to be taken?

Q. Explain about Wash Sale? Wash Sale - A wash sale takes place if stock or securities are sold at a LOSS and seller acquires substantially identical stock or SECURITIES 30 day

Existence - Detailed Audit of Stock In the previous the auditor accepted a director's certificate as to the existence of stocks.  Until some cases specifically in the United S

Q. If Kiner Company issues 3,000 shares of $5 par value common stock for $70,000, the account a. Paid-in Capital in Excess of Par Value will be credited for $15,000. b. Common Stoc