Intangible fixed
assets are intangible assets, which the accounting entity intends to keep for
more than one accounting period (the Income Tax Act also specifies that the
input price of intangible fixed assets must exceed the sum of CZK 60 000).
The value of
intangible fixed assets is measured by historical cost (acquisition price) for
assets purchased, by production costs for internally generated assets and by
replacement price for assets obtained gratuitously. Intangible fixed assets are
subject to amortization; the amortization period is stipulated by the Income
Tax Act. The intangible fixed assets must be accounted for in compliance with
the prudence principle as of the balance day, meaning that the accounting
entity should disclose either the net book value of the intangible fixed
assets, or the lower present market price.
Unlike under the
Czech regulations, the incorporate expenses as well as research and development
(R&D) should be accounted for under expenses. Under certain circumstances,
R&D may also be capitalized in the balance sheet. Goodwill pursuant to IFRS
3 should be disclosed only in the event that the goodwill was generated by
acquisition. Advance payments may be offset against debts from the same title.
