The intangible fixed assets note reconciles the opening and closing cost and amortisation of the company's intangible assets, mainly purchased goodwill. Tax Optimiser builds it from the trial balance.
What this note shows
For each class of intangible asset the note shows:
- Cost: at the start of the year, additions, disposals, revaluations, and at the end of the year;
- Amortisation (the cost written off over the asset's useful life): at the start of the year, on disposals, charge for the year, other movements (impairment / revaluation), and at the end of the year;
- Net book value at the end of this year and the end of last year.
Small companies must show these movements for each class of fixed asset (The Small Companies and Groups (Accounts and Directors' Report) Regulations 2008, Schedule 1). The note applies to FRS 102 Section 1A accounts. The amortisation method and useful lives go in the accounting policies.
Where the figures come from
The note supports two classes, Goodwill and Other intangibles. A class only appears as a column if the trial balance has balances for it. Each row reads one account:
| Row | Goodwill account | Other intangibles account |
|---|---|---|
| Cost at start of year | Goodwill costs b/f | Other intangible cost b/f |
| Additions | Goodwill additions | Other intangible additions |
| Disposals | Goodwill disposal of assets at cost | Other intangible disposal of assets at cost |
| Revaluations | Goodwill revaluations | Other intangible revaluations |
| Transfers (in closing cost, no separate row) | Goodwill transfers | Other intangible transfers |
| Amortisation at start of year | Goodwill amortisation b/f | Other intangible amortisation b/f |
| On disposals | Goodwill amortisation on assets disposed in the year | Other intangible amortisation on assets disposed in the year |
| Charge for the year | Goodwill amortisation charge for the year | Other intangible amortisation charge for the year |
| Other movements (impairment / revaluation) | Goodwill amortisation on revaluations | Other intangible amortisation on revaluations |
Accumulated amortisation is a credit balance in the trial balance. The note shows it as a positive figure and deducts it from cost. The amortisation charge for the year should match "Amortisation of intangible assets" in the operating profit note.
Completing the note in Tax Optimiser
Open the period, choose View Accounts, then Notes in the Actions menu on the left. Select Intangible fixed assets. The editor says: "Cells populated from the trial balance are read-only. Blank cells can be entered manually and are saved with the accounts."
Grey cells come from the trial balance. To change them, correct the trial balance. White cells (zero in the trial balance) can be typed in, which is useful for a movement you haven't posted to a separate account. Remember that the balance sheet is still built from the trial balance. After typing a figure, check that the net book value in the note still agrees to the intangible assets line on the balance sheet. The editor row "Other inc/dec" prints as "Other movements (impairment / revaluation)".
Click Save changes to save the note and rebuild the accounts preview.
Wording templates
The Additional note for intangible assets section prints under the table and has one template:
- Goodwill acquired – "Goodwill of £{{Goodwill}} arose on the acquisition of {{BusinessAcquired}} on {{AcquisitionDate}} and is being amortised over {{UsefulLife}} years." You'll be asked for
{{Goodwill}},{{BusinessAcquired}},{{AcquisitionDate}}and{{UsefulLife}}.
How it appears in the accounts
In the demo accounts the note is note 7. It has one Goodwill column and a Total column, with the additional note underneath.
Disposals and amortisation on disposals print in brackets. A dash means nil.
Frequently asked questions
Why doesn't the Other intangibles column appear in my note?
A class only appears when the trial balance has balances on its accounts. Post the costs and amortisation to the Other intangible accounts and the column will appear.
Why can I type in some cells but not others?
Cells the trial balance fills are read-only so the note matches the books. Cells the trial balance leaves at zero can be typed in and are saved with the accounts.
Where do I state the useful life of goodwill?
State the amortisation method and period in the accounting policies, and use the Goodwill acquired template here to describe the acquisition.
Does the intangible assets note show last year's movements?
No. The movements are for the current year only. The net book value at the end of last year is shown as the comparative.
Where to go next
- Guide to the notes to the accounts – how the Notes screen works
- Previous: Taxation note
- Next: Tangible fixed assets note
- Accounting policies
- Importing a trial balance