Register now or log in to join your professional community.
Fictitious assets are not in any physical form ,these are the assets created by accounting entry.the purpose is to account for the expense that cannot be paced under any normal accounting head. There assets are normally written of as soon possible against earnings.
Intangible assets are non monetary assets that lacks physical form , but the benefits of which will accrue in future and will be written off over a period of there benefit,
Therefore all fictitious assets are Intangible but all Intangible assets are not Fictitious assets.
Intangible assets are those assets devoid of a definite size and shape and that cannot be seen, touched etc... which has a useful life of more than1 year (Example : Goodwill, patent. trademark. The fact that we cannot see the physical existence of these assets but the benefits from this capital expenditure will derive only within a series of years.But intangible asset does not independently generate cash flows.Hence the value of intangible asset is huge and the benefits derive from many years ,only a proportionate amount to be written off every year by debiting the P&L A/c and the balance must shown on the asset side of the balance sheet.
So the intangible assets even without physical existence can make benefits for the firm.
But the fictitious assets are shown for name sake . It has no realizable value but with the actual cash expenditure . In fact they are shown to be written off or adjusted in the future .
The best example is preliminary expenses or incorporation expenses which cannot be placed under any normal account heading . Fictitious assets will be written of eventually against company's earning.
first to understand assets the valuable thing owned by the business are known as assets.the assets are further divided as fixed assets, current assets, fictitious assets tangible assets, intangible assets wasting assets liquid assets. now intangibles assets are those assets which we cannot see and touch or say do not have physical existence they can be bought and sold not in general but in special circumstance the best example is good will and patient. Goodwill and patient may help to maintain the company's reputation in future. in the same way fictitious assets are also those assets which we can not see and touch do not have physical existence and do not have any real value. but these assets are the revenue expenditure of capital nature which are also termed as deferred revenue expenditure. the examples are loss on issue of shares advertising expenses and preliminary expenses. It is not in the interest of the business to show the fictitious assets and intangible assets in the balance sheet that is why they are written off as far as possible.So all fictitious assets are intangible but all intangible assets are not fictitious.
In my opinion, Fictitious assets are such assets whose benefit is derived over a longer period of time, Like Deferred revenue expenditure, Misc. expenses, Preliminary expenses, Accumulated loss,etc. These assets are intangible too. In the other hand Goodwill, Trade Mark, Patents, Copyrights are intangible assets but not fictitious.
These are like intangible assets which cannot be seen or touched. Actually these are not assets but some expenditures which cannot trf to profit and loss account of a particular period that is why these items are shown on assets side of balance sheet to be written off to P&L account in reasonable years
All Fictitious assets are intangible because they have no physical existence but they only include to intangible assets to defer the huge expenses over a number of years and only charge specific/little portion to P& L every year. Thus heavy expenditures will not create burden on the profit of the enterprise. These assets include deferred revenue expenditures etc.
Fictitious assets and intangible assets are both have no physical existence but there are some different like as;
Fictitious assets are capital expenses which is be ones on one complete purchase than after it will depreciate as fix assets regularly till to nil.
Intangible assets are those assets which is not existence but we can take benefit regularly until our business has alive. Its price value decide by owners according to belief and demand of company e.g. Goodwill, patent etc.
All intangible assets including fictitious assets have no physical existence. And all fictitious assets are intangible but all intangible assets are not fictitious assets.
Both are Intangible (that could not be seen or felt) assets. the only difference is that the Fictitious Assets have no realizable value.
By character all fictitious assets are intangible.
All intangible assets including fictitious assets have no physical existence. Intangible assets having some realisable value are not fictitious .Eg; Patents, copy rights etc. Good will will become fictitious if it is not having any realisable value at the time of sale of a firm. Fictitious assets are capital loss
