SIN 142 under US GAAP.

Rules of SFAS No. 142, June 2001

Statement of Financial Accounting Standards (SFAS) No. 142        a.  Goodwill and Other Intangible Assets        b.  Issued in June 2001        c.  Supersedes APB Opinion No. 17, "Intangible Assets". Acquired intangible assets        a.  An acquired intangible asset             --> recognized based on its fair value. Intangible assets not specifically identifiable        a.  Internally developed intangible assets             --> not recognized as an asset on the balance sheet.             --> rules of SFAS No. 142 are same as APB Opinion No. 17        b.  Cost of internally developing intangible assets                  (not specifically identifiable)             --> recognized as an expense when incurred. Amortization of intangible assets         a.  An intangible asset with a finite useful life             --> amortized over its useful life.         b.  If the useful life is not limited             --> by legal, economic or other factors,             --> useful life is indefinite (not infinite).         c.  Amount to be amortized                   = cost - residual value         d.  If the pattern of economic benefits can be determined             --> Amortization method should reflect such pattern.         e.  If the pattern of economic benefits cannot be determined             --> Straight-line amortization Goodwill         a.  Goodwill is not amortized.             --> Goodwill is tested for impairment         b.  Impaired             --> fair value < carrying amount         c.  Test for impairment             --> on an annual basis         d.  If certain events would reduce fair value below carrying amount,                        --> test for impairment is done                   between annual tests.

Old Rules of APB Opinion No. 17 (Before superseded by SFAS No. 142)

Accounting Principles Board (APB) Opinion No. 17         a.  Intangible Assets         b.  Issued in August 1970         c.  APB Opinion No. 17: Superseded by SFAS No. 142, June 2001 Intangible assets acquired from others (companies or individuals)         a.  Cost of acquisition             --> recorded on the balance sheet as intangible assets         b.  Amortized over the periods of benefits             --> not to exceed 40 years Intangible assets not specifically identifiable         a.  Cost of developing such intangible assets             --> charged to income when incurred.         b.  Internally developed intangible assets             --> not recognized as an asset on the balance sheet. Amortization of intangible assets         a.  Intangible assets             --> amortized over the periods of benefits.         b.  The period of amortization             --> should not exceed forty years.         c.  It is assumed that             --> the value of intangible assets will                   eventually disappear.