Conceptually, intangible assets are just like PP&E except for one important difference: intangible assets have no physical form. Intangible assets enable the business to carry out its operations in the same way that PP&E does. The usage of intangible assets gives rise to another type of non-cash expense item called amortization expense.
There are many types of intangible assets, such as patents, copyrights, trademarks, customer lists, brand names, etc. For the Star Wars fans, the sale of Lucasfilm to Walt Disney in late 2012 involved intangible assets.
It would be worthwhile to keep in mind these important points about intangible assets so that you can better appreciate the value of the ROIC (Return on Invested Capital) analysis.
