AP: AUDIT OF INTANGIBLES

Test of Controls is not necessary for Retail and Trade Company (MSME).
WHY?
➢ Minimal for a Retail and Trade Companies
➢ Non-recurring
➢ The main concern of Retail and Trade Companies is to Buy and Sell goods.
Test of Details of Balances, Test of Details of Transactions, and Substantive Analytics shall be used.
Primary Assertion to be tested: Existence (Intangible Assets has no physical substance)
Research and Development – expense (PFRS for SMEs)
Research and Development (Full PFRS) Research is always expense
Development may be capitalize:
All of these criteria must be met (MAPAIT)
Measurable
Available Funds
Probable to be Intangible Asset
Ability to sell or use the Intangible
Intention to sell or use the Intangible
Technical Feasibility
Purpose of Intangible Asset is to (1) increase revenue; or (2) reduce cost