Talvera Media: licence, patents and brand, from purchase to disposal

Talvera Media runs a platform of travel videos and magazines. To modernise it, in year N it buys three intangible assets from third parties: a recommendation engine licence, a portfolio of three video compression patents and the Vélissa magazine brand. You follow these assets over three years (N, N+1 and N+2): initial cost, useful life and amortisation, revision of estimates, testing of the brand, then disposal of a patent and disclosures. All figures are case data; teaching assumptions and professional judgements are flagged as such. None of these assets was internally generated.

Standard involved: IAS 38 Intangible Assets (separate acquisition, deferred payment). A purchased intangible asset is measured initially at cost; you still need to know which items of the invoice and of the go-live project belong to that cost, and what happens to a price paid two years later. Read the licence invoice and the patent purchase agreement, then answer the questions in order.