Ministry of Justice of Ukraine
November 2, 1999
of October 18, 1999 No. 242
About approval of the National provision (standard) of financial accounting
In pursuance of the Program of reforming of the system of financial accounting using international standards approved by the resolution of the Cabinet of Ministers of Ukraine of October 28, 1998 No. 1706, I ORDER:
1. Approve the National provision (standard) of the financial accounting 8 "Intangible assets" (further - the Provision (standard) 8) approved by Methodological council on financial accounting under the Ministry of Finance of Ukraine which is applied.
2. Determine that the specified National provision (standard) 8 is applied concerning accounting of transactions which happen since 2000.
3. Provide that other regulations of the Ministry of Finance of Ukraine on financial accounting are effective in the part which is not contradicting the National provision (standard) 8.
A. V. Litvin
Approved by the Order of the Ministry of Finance of Ukraine of October 18, 1999 No. 242
1. This National provision (standard) determines methodological bases of forming in financial accounting of information on intangible assets and incomplete capital investments into intangible assets (further - intangible assets) and disclosures of information on them in the financial reporting.
2. Regulations of this National provision (standard) are applied by the companies, the organizations and other legal entities (further - the companies) all patterns of ownership (except budgetary institutions and the companies which according to the legislation constitute the financial reporting under International Financial Reporting Standards).
3. This National provision (standard) does not extend to goodwill and transactions with intangible assets which features of accounting are determined by other provisions (standards) of financial accounting.
4. Terms which are used in provisions (standards) of financial accounting have such value:
The active market - the market in which such conditions are inherent:
objects which are on sale and bought in this market are uniform;
at any time it is possible to find the interested sellers and buyers;
information on market prices is public.
Group of intangible assets - set same to destination and to conditions of use of intangible assets.
Research - the researches planned by the companies which are conducted by them for the first time for the purpose of obtaining and understanding of new scientific and technical knowledge.
Intangible asset - non-monetary asset which has no material form and can be identified.
Development - application by the company of results of researches and other knowledge for planning and design new or considerably advanced materials, devices, products, processes, systems or services prior to their serial production or use.
Incomplete capital investments into non-material aktivykapitalny investments into acquisition, creation and upgrade of intangible assets which use to destination for date of balance was not performed.
Cumulative depreciation of intangible assets - depreciation amount of object of intangible assets since the beginning of its useful use.
Non-monetary assets - all assets, except money, their equivalents and accounts receivable in fixed (or determined) amount of money.
5. Financial accounting of intangible assets is kept concerning each object on such groups:
rights to use by natural resources (mineral right, other resources of the environment, geological and environment other information and so forth);
property use rights (right to use by the parcel of land, according to the land legislation, right to use by the building, and so forth);
the rights to commercial designations (the rights to trademarks (signs for goods and services), commercial (corporate) names and so forth), except those, expenses on which acquisition are recognized to royalty;
the rights to objects of industrial property (the right to inventions, useful models, industrial designs, plant varieties, breeds of animals, configuration (topography) of integrated chips, trade secrets, including know-how, protection against unfair competition and so forth), except those, expenses on which acquisition are recognized to royalty;
copyright and the rights, adjacent to it (the right on literary, art, pieces of music, computer programs, programs for electronic computers, compilations of data (database), execution, soundtracks, video games, transfers (program) of the organizations of broadcasting and so forth), except those, expenses on which acquisition are recognized to royalty;
other intangible assets (right to activities implementation, use of economic and other privileges and so forth).
Recognition and assessment of intangible assets
6. The acquired or received intangible asset is displayed in balance if there is probability of receipt of the future economic benefits connected with its use, and its cost can be authentically determined.
7. The intangible asset received as a result of development should be displayed in balance under conditions if the company has:
intention, technical capability and resources for bringing intangible asset to condition in which it is suitable for realization or use;
possibility of receipt of future economic benefits from realization or use of intangible asset;
information for reliable expense determination, connected with development of intangible asset.
8. If the intangible asset does not answer the specified recognition criteria, then the expenses connected with its acquisition or creation are recognized expenses of that accounting period during which they were performed without recognition of such expenses in the future by intangible asset.
9. Are not recognized intangible asset, and are subject to display as a part of expenses of that accounting period in which they were performed:
expenses on research;
expenses on preparation and retraining of personnel;
promotional expenses and promotion of products in the market;
expenses on creation, reorganization and movement of the companies or their part;
expenses on increase in goodwill of the company, cost of editions and expenses on creation of trademarks (trademarks).
10. The acquired (created) intangible assets are enlisted on balance of the company for primary cost.
11. Primary cost of the acquired intangible asset consists from the price (cost) of acquisition (except the received trade discounts), duties, indirect taxes which are not subject to compensation, and other expenses which are directly connected with its acquisition and bringing to condition in which it is suitable for proper use.
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