Amortisation

Formal

To gradually reduce the book value (of an asset) over a period of time equal to its projected useful life. A technical term for a form of depreciation commonly used for the assets of Goodwill and types of Intellectual Know-how.

Straight Talk

Is simply a technical term for a specific form of depreciation that is applied to Goodwill and Know-how. This is the charge that is applied over a period to reflect the reduction in worth or value of these ‘clever’ assets so that the business reflects the real worth of these throughout their useful lives.