Why are intangible assets not typically included on a company’s balance sheet?

Intangible assets are not typically included on a company's balance sheet because they do not have verifiable prices. This means that their value can be subjective and difficult to measure accurately. Unlike tangible assets, which have clear market values based on physical characteristics and direct comparables, intangible assets like patents, trademarks, or goodwill often rely on estimates or the future economic benefits they may provide.

Accounting standards often require tangible assets to be recorded at their fair market value, while intangible assets lack such clarity and market-based valuation, which complicates their inclusion in financial statements. This subjective nature of valuation means that unless intangible assets are acquired in a business combination, where their value can be more objectively assessed, companies may refrain from listing them on their balance sheets to maintain a transparent and reliable representation of their financial position.