Q. Rights to display a cartoon film, whether an intangible asset

Question

Sir,

A company makes cartoon films and runs them on various social media platforms - Youtube, Facebook, Instagram etc. and earns revenue from advertisement and share of revenue as per the policy of YouTube, Facebook etc. The company considers the cost of making a cartoon film as its 'cost' and does not treat it as an 'Intangible asset'. The company does not sell the rights to exhibit, copy or display to any third party. Is this accounting treatment correct?

Answer 1

Its as good as a motion picture. It would be Intangible asset. Please refer to Technical Guide Accounting for Motion Picture Films issued by ICAI.