The following conditions are met:

(1) It is technically feasible to complete the intangible asset so that it can be used or sold.

(2) Have the intention to complete the intangible asset and use or sell it. Businesses should be able to explain their purpose for developing intangible assets. (3) The ways in which intangible assets generate economic benefits include being able to prove that there is a market for the products produced using the intangible assets or that the intangible assets themselves have a market; if the intangible assets will be used internally, their usefulness must be proven.

(4) Have sufficient technical, financial and other resource support to complete the development of the intangible assets, and have the ability to use or sell the intangible assets.

(5) The expenditures attributable to the development stage of the intangible asset can be measured reliably.

Intangible assets are recognized when the following three conditions are met at the same time: 1. Meet the definition of intangible assets; 2. The estimated future economic benefits related to the intangible assets are likely to flow into the enterprise; 3. The cost of the intangible assets Able to measure reliably.

Meeting the definition of intangible assets

Meeting the definition of intangible assets is a prerequisite for the recognition of intangible assets. That is, items accounted for as intangible assets must be non-monetary long-term assets without physical form that are held by the enterprise to produce goods, provide services, lease to others, or for management purposes.

The economic benefits generated are likely to flow into the enterprise.

The economic benefits generated are likely to flow into the enterprise, which is one of the basic conditions for the recognition of intangible assets.

In accounting practice, professional judgment is required to determine whether the economic benefits created by intangible assets are likely to flow into the enterprise. When implementing professional judgment, the following relevant factors need to be considered: whether the enterprise has sufficient human resources, a high-quality management team, relevant hardware equipment, relevant raw materials, etc. to cooperate with intangible assets to create economic benefits for the enterprise and other internal factors.

Costs can be measured reliably

Costs can be measured reliably, which is another basic condition for the recognition of intangible assets. For intangible assets, this condition is very important.

Characteristics of intangible assets

① Non-entity. On the one hand, intangible assets do not have a material form that people can feel with their senses. They can only feel it conceptually.

②Monopoly. The monopoly of intangible assets is manifested in the following aspects: some intangible assets are protected by the legal system and are prohibited from being obtained free of charge by non-holders; they exclude illegal competition from others.

For example, patent rights, trademark rights, etc.; although the exclusive rights of some intangible assets are not protected by law, they can actually be monopolized as long as they can ensure that the secrets are not leaked to the outside world, such as proprietary technologies, secrets, etc. There are also some intangible assets that cannot be separated from the enterprise as a whole and cannot be obtained by others unless the property rights of the entire enterprise are transferred, such as business reputation.

③Uncertainty. On the one hand, the validity period of intangible assets is difficult to determine accurately due to the impact of technological progress and market changes; on the other hand, the validity period is unstable.

④Enjoy sex. It means that after the paid transfer of intangible assets, they can be owned by several entities at the same time. However, fixed assets and current assets cannot be used in two or more enterprises at the same time. For example, a trademark right transferee enterprise can use it. At the same time, the transfer enterprise can also use it.

⑤High efficiency. Intangible assets can give enterprises economic benefits that are far higher than their costs.