Non-current Assets - Intangible 12 / 18

The key assertions here are existence and valuation

The intangibles are:

  • Goodwill

  • Intangibles with a market value

  • Development costs

Goodwill Proforma
FV of consideration1,000
FV of NCI400
FV of Net Assets acquired(1200)
Impairment(100)
Goodwill100

Substantive tests for Goodwill

  • Check amount paid for the business acquired

  • Check the reasonableness of the net assets acquired value

  • Check the goodwill calculation

  • Check for any impairment indicator (no amortisation for goodwill)

Substantive tests for Intangibles

  • Check to purchase invoice

  • Check amortisation calculation

  • Check for indicators of impairment

  • Ensure correct accounting (eg Development costs not research costs)

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