6.6 No specific information is required for intangible assets, with the exception of information already required for fixed assets. Information that goes beyond the information on existing investments required by GASB Statement No. 34 and other existing information that may relate to intangible assets, including that required by Accounting Principles Board (PDB) Opinion No. 22, Disclosure of Accounting Policies, is not required. (b) Land rights, including rights to water, minerals and timber, are currently classified as investments by U.T. System. Rights to water or timber are generally not owned by U.T. System, separately and outside of the ownership of the land in fee simple. Land rights are the rights to use or remove certain land whose rights have been separated from the simple title to the land.
U.T. System has acquired many mining rights as it generally retains mining rights to all the properties it sells. These cut mining rights are called by the U.S. system « Trust Minerals ». CFSP Declaration No 51 concludes that intangible assets acquired or created primarily for the purpose of directly generating income or profits should not be classified as fixed assets; Instead, they should be classified as investments. Trust mining rights held by U.T. System are acquired or retained primarily for the purpose of directly generating income or profits and are classified by U.T. System as investments and not as intangible assets. When property is purchased, ownership consists of a « set of rights » that includes the rights to control the use of the property and to benefit from the property. Although the individual rights contained in the set of rights are distinct and intangible in nature, together they constitute ownership of the asset. Therefore, the value of individual property rights should remain aggregated and reported as physical capital (land). Only land use rights acquired in a transaction that did not involve the acquisition of the underlying asset should be reported as intangible assets if they meet the definition of an intangible asset.
This requirement applies regardless of whether an intangible asset is acquired externally or generated internally. IAS 38 contains additional recognition criteria for internally created intangible assets (see below). An intangible asset with an indefinite useful life should not be depreciated. [IAS 38.107] 4.1 GASB Statement No. 51 defines intangible assets as assets that have all of the following characteristics: In addition, all expenses related to the creation of the intangible asset are recognised as an expense. However, intangible assets created by a company do not appear on the balance sheet and do not have a recognized book value. For this reason, when buying a business, the purchase price is often higher than the book value of the assets on the balance sheet. The buying company recognises the premium paid as an intangible asset in its balance sheet. Governmental Accounting Standards Board (GASB) Statement No.
51, Accounting and Financial Reporting for Intangible Assets, requires intangible assets to be classified and reported as investments. Examples of intangible assets include easements, water rights, timber rights, patents, trademarks and computer software. Intangible assets may be acquired or licensed, acquired through over-the-counter transactions or generated internally. The University of Texas system implemented the requirements of the fiscal 2010 statement with the previous year`s adjustment. 4.2 Intangible assets: identifiable criteria (business combinations) A research and development project acquired as part of a business combination is recognised as an asset at cost, even if a component is research. Subsequent expenses for this project are recognised as other research and development expenses (related to expenses, except to the extent that the expenses meet the criteria of IAS 38 to recognise these expenses as intangible assets). [IAS 38.34] Due to the nature of intangible assets, subsequent expenses rarely meet the criteria for accounting for the carrying amount of an asset. [IAS 38.20] Subsequent expenses for brands, fingerprints, publisher titles, customer lists, and similar items should always be recognized as income. [IAS 38.63] 8.1 The statement identifies software as a common type of intangible asset that is often generated internally.