In the United States, intangible assets are growing rapidly to account for nearly half of the total assets. Intangible assets are defined as, "assets that do not have a physical or financial embodiment "by the Organization for Economic Co-operation and Development (OECD). These assets are also currently referred to as intellectual assets, knowledge assets, and intellectual capital due to this lack of embodiment. There are specific types of intangible assets that are common among nearly every business and there are common problems that occur when discussing intangible assets (Nolan).
The most common form of intangible assets are comprised of patents, copyrights, trademarks, trade names, franchise licenses, government licenses, and goodwill. Patents are the exclusive rights that allow the patent holder to produce or sell new inventions. Without a patent, another business or entrepreneur could take the ideas/products from any company and sale the same product as their own. A patent however, prevents this intellectual theft from occurring and the patent is used to defend against theft in a court of law. Next, copyrights give the holder exclusive rights to reproduce and sell works of art; such as books, songs, or movies. Copyrights are similar to patents in the sense that they can be taken to a court of law as a way to defend the ideas. Trademarks and trade names deal with the logos, product names, and advertising jingles of corporations. These trademarks and names are what identify companies and products from one another and have to be registered. .
Franchise licenses are paired with trademarks and trade names in order to give the owner of a franchise the rights to use certain trademarks and trade names. Independently owned fast-food, hotels, automobile dealerships, etc. have to attain a franchise license in order to use the jingles, logos, and product names of the companies which supply them goods and services.
