Discuss the intangible asset has been treated correctly

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Point 1: H has its own mini video production at the campus. As a result, it has material intangible asset (intellectual property) which is associated to content rights for the short videos produced. H estimated its production cost based on the estimated future advertising revenues for the videos.

Point 2: Currently, H amortises the content rights based on the estimated future advertising revenues derived from the videos. For example, if a video is expected to earn total advertising revenues of RM2,000, and RM1,000 will be generated during 1st year, then the intangible asset will be amortised by 50% in year 1.

Question 1: Discuss whether the intangible asset has been treated correctly according to IAS38.

Reference no: EM132581548

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