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CA Final · Financial Reporting · Ind AS 38 Intangible Assets

Aarav Digital Ltd plans a web site for sale to another entity and also operates its own web site for customers. Which treatment follows Ind AS 38 and the web site costs Appendix?

The web site costs Appendix does not apply to a web site or its software developed for sale to another entity, or accounted for under Ind AS 116. It does apply to the entity's own web site, which is an internally generated intangible asset under Ind AS 38.

  1. AThe Appendix does not apply to the web site developed for sale to another entity, but applies to the entity's own web siteCorrect
  2. BThe Appendix applies to both web sites equally
  3. CThe Appendix applies only to the web site developed for sale
  4. DThe Appendix does not apply to either web site

Explanation

The Appendix does not apply to expenditure on developing or operating a web site (or its software) for sale to another entity or accounted for under Ind AS 116. The entity's own web site is an internally generated intangible asset within Ind AS 38. So only the own web site is covered.

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