The biggest technology-related intangible is patents. A patent provides licensing for inventions or other unique processes and designs. Items that patents protect run the gamut from pharmaceuticals, to automobile circuitry, to unique machinery designs.
If a company purchases a patent from the inventor, the capitalised cost is the purchase price plus any costs incurred as part of the acquisition process, such as legal fees. Costs leading to patents developed in house aren’t capitalised, but are shown immediately as expenses on the income statement.