Activation of intangible assets

Since the enactment of the new accounting law in 2015, the activation of intangible values is no longer optional but mandatory. Learn more about the activation criteria in our article.

Recognition Criteria according to OR

According to Art. 959 II of the Swiss Code of Obligations, assets must be recognized if, based on past events, they can be disposed of, a cash inflow is probable, and their value can be reliably estimated. Other assets may not be recognized. Intangible values are generally activatable at acquisition or production costs minus the necessary depreciation, provided they bring measurable benefits to the company over several years.

Formation and Capital Increase Costs

In the case of formation and capital increases, the criterion of future cash inflow is not met, which is why the incurred costs cannot be activated. Consequently, the costs are recorded as expenses at the time of occurrence and reduce the profit or increase the loss of the respective period.

Self-created Intangible Assets

Self-created intangible assets may (but do not have to) be activated if the asset: - is identifiable; - belongs to the company; - brings measurable benefits to the company over several years; - the expenses incurred to create the intangible asset can be recorded and measured separately; and - it is probable that the means necessary for completion and marketing or for the company's own use of the intangible asset are available or will be provided.

For self-created intangible assets that meet the above conditions, development costs may also be activated. However, there is a strict prohibition on activating research activities, as the probability of obtaining future economic benefits is still considered too low.