Intellectual Property
The term encompasses any concept, idea, literary creation, computer program, or other artistic or creative work that is definable, useful measurable, and proprietary in nature.
Intellectual Property is a term that is used to mean a property of a creative mind or a work of the intellect. It is a blanket expression presently used in legal terms to denote original creative thought such as patterns, trade marks, inventions and copyright material including computer programs. It is an intangible asset with commercial value.
Intellectual property encompasses among other things, inventions, symbols, literary and artistic works, images, names, and designs used in commerce.
It cannot be accurately valued but when acquired; it can be shown on a balance sheet in the form of assets to give a more accurate valuation for the assets.
The Intellectual property can be divided into four categories: Trade secrets, Patents, Trademarks and Patents.
Trade secrets
They are the intangible assets that are easily transferred to the competition. Most of the cases involve revealing the secrets unwittingly or deliberately by insiders. Two or three decades ago, such secrets would have been difficult to be obtained by outsiders, but with the advancement of the new technology, it has become easily revealed. Consequently, in today’s world with the advent of the computer age, companies with trade secrets must implement programs to protect their competitive edge.
Trade secrets are perpetual. They do not have a lifespan like patents. Companies spend money, time and energy developing processes that give them an edge over the competition. These processes could involve improving their products, increasing productivity and efficiency or cutting down on costs; once developed, they become an asset to their developer/owner. These secrets must be protected by the owners and cannot be protected by law.
Patents
A patent is an exclusive right granted by a state to an...