Trademarks / licences

Anne Boleyn
Anne Boleyn Registered Posts: 196 Dedicated contributor 🦉
in General accounting discussion
Hi All

I'm hoping someone can help with the following. A company has a trademark which another (unconnected) company uses without permission, all settled legally. However what do I do with the damages awarded and the licence fee for the company now being able to use the trademark. I assume the licence fee will go in the P&L under other income. Where would the damages go? and would the trademark have to be revalued?

Sorry if this is a simple question but I haven't come across it before.

Thanks to all who respond

Comments

  • tripod333
    tripod333 Registered Posts: 20 New contributor 🐸
    I would agree that the License fee goes to the P&L under other income. I suspect damages would also go to the P&L as the damages presumably represents lost income from the licence fee that was being used without authorisation from the company.
    I don't believe you would be able to revalue the trademark, as the value of intangible assets are normally only entered on the balance sheet at time of purchase.
    I haven't come across this exact scenario either, but based on my studies, this is what I would do.
  • Anne Boleyn
    Anne Boleyn Registered Posts: 196 Dedicated contributor 🦉
    Trademarks

    Thanks for replying, it's much appreciated.

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