The rulemakers for private-sector financial accounting (the Financial Accounting Standards Board - FASB and the International Accounting Standards Board - IASB) took action a number of years ago on account for intangible assets (see our paper Reporting Intangibles). However, those rules applied only to purchased intangible, not internally generated assets. FASB and IASB are looking into that issue, after a couple of years break. In the meantime, the rulemakers for state and local government accounting -- the Governmental Accounting Standards Board -- has been steadily moving forward, starting in May of 2003. In July of this year, they issued GASB Statement No. 51, Accounting and Financial Reporting for Intangible Assets, which includes internally generated assets.
It is heartening to see that GASB has grappled with this tough issue. It is now up to FASB and IASB to pickup the work - and the pace.
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