In their article entitled 'U.S. firms challenged to get "intangibles" on the books', Byrnes and Aubin (2011) noted that in the United States some companies were accounting for intangibles such as brands, patents and information technology differently when they were developed internally rather than being acquired. This could mean major differences in accounting numbers where internally generated intangibles developed at low costs by one company were sold for large amounts to another company. They noted:

The accounting difference could result in distorted behaviour, warns Abraham Briloff, a professor emeritus of accountancy at Baruch College, tempting companies to buy intellectual property rather than doing research themselves Required 1. Explain the accounting for internally generated intangible assets in AASB 138/IAS 38.

2. Discuss any differences between accounting for internally generated intangible assets and acquired intangible assets in AASB 138/IAS 38.

3. Discuss why companies may be reluctant to press for changes in AASB 138IAS 38 to require more recognition of internally generated intangible assets.