What are intangible assets?
Intangible assets (IA) are assets that are non-physical in nature, owned by you or your business. These include both intellectual property (IP), such as patents, trademarks, and registered designs, as well as other non-registrable assets, like know-how, data and key relationships. Each company will have its own unique mix of IA and IP types, which make up the ingredients to its ‘secret sauce.1
For a textbook definition, International Accounting Standard (IAS) 38 defines IA as identifiable (either being separable or arising from contractual or other legal rights), non-monetary assets without physical substance. IA largely comprise IP and other assets that grant potential economic benefits to the owner.2
What is the difference between intangible assets and intellectual property?
Intangible assets (IA) comprise both intellectual property (IP) and other non-registrable assets, such as know-how, data, and key relationships.3 Simply put, IP may be considered a subset of IA.
What are the different types of intangible assets?
Intangible assets (IA) include, but are not limited to:
Copyright protects the expression of ideas in the form of literary or artistic works, such as novels, videos, music, photographs, and other media works. It also applies to computer software. While copyright covers all content produced by a company, only certain assets may be of significant value on their own.
Registered designs protect the aesthetic look of an article or non-physical product, like its shape, pattern, or configuration.
Patents protect the functional elements of a technology or “how it works”. A patent should provide a technical solution, and an aspect of the solution must be novel, inventive and non-obvious.
Brand refers to the way businesses’ products and services are experienced by consumers, along with market and customer opinions of the company. Having a brand helps to maintain a company’s distinction in the marketplace even if a competitor is offering a similar product. Additionally, different forms of protection over a brand are by themselves also IA, which include registered and unregistered trade marks, and domain names.
Registered trade marks provide a formal registration to protect the brand from confusingly similar brands in the marketplace.
Unregistered trade marks refer to a brand’s reputation, awareness among consumers, and offerings. Unlike registered trade marks, these rights arise from “use”, and is not registered.
Internet addresses which contribute to online branding may be protected. Domain names provide another consumer touchpoint, which enhances overall brand presence.
Valuable data is either unique in origin or history, provides important insight, or has an associated value proposition.4 This can range from client databases, estimated market size, actual number of products or services purchased, to milestone numbers that can predict trends.5
Trade secrets and know-how refer to an important piece of information which contribute to a commercial advantage, that is not available in the public domain. It may be a way of working, a recipe, a formula, procedure, set of algorithms or a specification. This includes secret recipes, a secret step in a production process, as well as commercial information such as the plans to launch a new business model.6
What is IP management and how is it useful for my business?
Intellectual property (IP) and intangible assets (IA) can be key drivers for business success. Understanding IA and how to manage them well can build strong foundations for growth and expansion, as well as create new revenue streams.
Good IP management involves effectively identifying, prioritising and securing IP rights essential to your business. It also extends beyond protection to monetisation, by leveraging your IA to seize business opportunities, tide over and thrive in challenging times, and even secure investor funding for growth.
How do I know if I have intangible assets that should be protected or managed?
Book a complimentary 45-minute chat with us on your intangible assets (IA) today! Following a deeper understanding of your business, our IP Strategists will be able to advise on questions such as: