Over the last couple of years, we have incurred some expenses during the course of applying for a trademark. The trademark has only recently been granted and I understand that the trademark needs to be recorded as an intangible asset, together with the costs incurred during the application. My question is, when are the costs posted to the intangible asset account? Is is on the date when the trademark is registered? I assume that the intanglble asset does not actually exist until that point. If so I assume that I need to make an adjustment to the expense account to which they have been posted to move them to the intanbible asset account? Some of the expenses relate to financial years which have been closed off.
Thanks for your reply. I do currently have the trademark expenses separated out into their own expense account. My query really relates to the fact that I have recently discovered that the trademarks themselves and the assoiated costs should be posted to an intangible assets account on the balance sheet rather than as expenses in the profit and loss. I really need to know how I deal with those trademark expenses allocated to the profit and loss account in the previous financial year, which should be in the intangible asset account. Do I just make an adjustment in this financial year to move them? If so, when do I move them? Is it the date that the trademark was issued ie: the date presumably from which the intangible asset came into existance?
if the previous years accounts contain expenses that shoudl have been capitalised, you should in theory enter a prior period adjustment in the current year accounts and send in amended tax returns. You will have restate the comparitives for the previous period.
How much are you talking about, if it isnt too much, sub £250, i would wonder if it is worth it, although it is the correct thing to do.
Nick
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Nick
Nick Craggs FMAAT ACA AAT Distance Learning Manager
