BC4 An intangible asset was defined in the previous version of IAS 38 as ‘an identifiable non‑monetary asset without physical substance held for use in the production or supply of goods or services, for rental to others, or for administrative services’. The definition in the revised Standard eliminates the requirement for the asset to be held for use in the production or supply of goods or services, for rental to others, or for administrative services.

BC5 The Board observed that the essential characteristics of intangible assets are that they:

(a) are resources controlled by the entity from which future economic benefits are expected to flow to the entity;

(b) lack physical substance; and

(c) are identifiable.

The Board concluded that the purpose for which an entity holds an item with these characteristics is not relevant to its classification as an intangible asset, and that all such items should be within the scope of the Standard.