Questions:
Which IFRS standard deals with the recognition of assets acquired through the merging of two business? What is the standard for intangible assets?

On 1 January 2023, Jay's Perfume LLC acquired 100% of Tims Co. Both companies operate in the perfume sector. Jay's Perfume LLC intends to merge the manufacture of Tims Co products into its facilities and close the Tims Co manufacturing unit. Tims Co brand name is well known in the sector, retailing at premium prices, and therefore, Jay's Perfume LLC will continue to sell products under the Tims Co name after its registration has been transferred and its manufacturing units have been integrated. The directors of Jay's Perfume LLC believe that most of the value of Tims Co was derived from the brand and there is no indication of the impairment of the brand on 31 December 2023.

Will the Tims Co brand name be accounted as part of goodwill or separately as cash-generating unit after the integration of the manufacturing units?

Reference answers:
IFRS 3 Business Combinations. This states that the acquirer must recognize identifiable intangible assets acquired in a business combination separately from goodwill. To be identifiable, the asset must be separable or arise from contractual or legal rights.

The Tims Co is intangible because it has no physical substance. It meets the definition of an asset because it has the potential to generate future economic benefits by increasing sales volumes and the ability to charge premium prices. Brands are separable because they can be disposed of. As such, the brand is a separable intangible asset and must be recognized separately from goodwill.