Patent
Accounting glossary · Understand, connect, apply
A patent is a legal right that allows its holder to exclude others from specified uses of a qualifying invention for a limited period under applicable law.
Example
A business acquires a patent and assesses its finite economic useful life when considering amortization.
Remember the difference
A US utility patent generally has a term measured from the relevant filing date, not simply 20 years from grant. Patent categories and exceptions differ.
Examples are simplified for learning. Where a term depends on US law, IFRS, US GAAP or a historical rule, check the context explained above and the requirements relevant to your course.
Study references: OpenStax financial accounting and managerial accounting. For reporting requirements, consult the applicable IFRS Standards or FASB guidance. US tax terms should be checked against the relevant tax-year IRS instructions.
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