Intangible asset
A non-monetary asset without physical substance that is identifiable and controlled by the business: patents, trademarks, software, customer bases, business goodwill, and licences. It appears on the balance sheet only when acquired or internally developed at a reliably measurable cost.
In practice
For a software publisher or franchise network, intangible assets often represent 60 to 80 percent of enterprise value, yet only a fraction appears on the balance sheet. This gap between accounting and economic value is why earnings multiples remain the preferred valuation method for knowledge-intensive businesses. An annual IP audit — inventory, filing status, verified assignments — is a minimum governance practice.