Under AASB 138 Intangibles,an intangible asset with an indefinite useful life is:
A)not able to be recognised by an entity as an asset
B)not subject to annual amortisation charges
C)amortised using the straight-line method over a period of no more than 20 years
D)amortised using the reducing balance method over a period not exceeding 5 years.

Question

Quizplus · Accepted Answer

According to AASB 138, an intangible asset with an indefinite useful life cannot be amortized, but it needs to be tested for impairment every year, as it may decline in value over time. Therefore, option B is correct as it states that the asset is not subject to annual amortisation charges. Options A, C, and D are incorrect as they provide incorrect information regarding the recognition and amortisation of intangible assets with indefinite useful lives.

Under AASB 138 Intangibles,an Intangible Asset with an Indefinite Useful