Intangible Assets refer to assets that a company owns that are not physical in nature but hold substantial value. These assets include intellectual property like patents, copyrights, and trademarks, as well as brand reputation, goodwill, and trade secrets. For example, the value of a company's brand name or the patented technology it owns are considered intangible assets.

Unlike tangible assets like machinery or buildings, intangible assets are not physically measurable but play a crucial role in the overall valuation and operations of a business. For instance, a tech company might rely heavily on its patented software as an intangible asset to generate revenue, or a brand's goodwill might enhance customer loyalty and acquisition.

Intangible assets are often accounted for in financial statements, especially when acquired through a business combination, as seen on the balance sheet alongside physical assets. Companies also amortize certain intangible assets over their useful life, such as a ten-year patent that is accounted for each year by recognizing its gradual expense. It's essential for financial and accounting professionals to accurately assess and record intangible assets to reflect a business's true value.