Intangible assets

Daum JH. Intangible Assets and value creation. John Wiley Sons 2002. 

A joint venture (J V) allows a combination of tangible and intangible assets of the partners in a way to optimize the combined offering. JVs are popular in the chemical industry, particularly between Western and Chinese companies in China. It has to be pointed out, however, that the of JV failure rate is quite high. This is particularly the case for horizontal JVs, where all activities, such as R D, production, and M S, are shared. The main reasons are culture clashes that prevent the expected synergies and conflicts of interests with other activities of the partners. 

JV would compete with core businesses of the partners Valne of tangible and intangible assets brought to the JV are difficult to valuate fairly... 

One of the intangible assets that requires further attention is goodwill. By definition, goodwill is an intangible asset of a company that includes factors such as reputation, continued patronage, and expertise, for which a buyer of the company may have to pay a... 

The fixed assets include not only the property and equipment that are normally thought of as assets, but also the intangible assets, such as patent rights and any strategic investments in other companies. The current assets cover not only cash, as already stated, but also unpaid invoices for goods sold, and inventories of unused raw materials, semifinished and finished products. 

Intangible assets such as patents, trademarks, goodwill, etc. 

In capitalism, there can be socialist exploitation by the skilled as well as capitalist exploitation by the capital owners. In socialism, capitalist exploitation is eliminated, only socialist exploitation remains, to be eliminated under communism. 1 do not think this re-conceptualization of exploitation is very helpful. It replaces the ill-defined notion of labour content by another that is hardly in better shape, namely the idea of "withdrawing with one s per capita share of society s intangible assets", that is skills. Even as a thought experiment, it remains unclear how the workers are to take with them their share of the managerial skill, while leaving the managers behind them. ... 

Depreciation, Amortization, and Depletion. The federal government allows a company to charge off a portion of an asset due to wear and tear as well as obsolescence each year as an operating expense. This is a paper transaction and is not a cash item. Amortization is the decline in useful value of an intangible asset such as a patent. Depletion is the diminution of a natural resource, such as coal in a mine. All these paper allowances appear as one item in most income statements. 

Business leaders must learn to recognize, respect and employ in broad measure, the value of an enterprise s most intangible assets — intellectual capital. As Albert Einstein put it, not everything that can be counted counts, and not everything that counts can be counted. More intuitive measures should be employed. Chemical engineers need to accommodate what counts, internally by rewarding talented engineers... 

Conservative accounting practices require that such upfront payments be expensed, rather than capitalized as investments, because unapproved drugs are considered intangible assets of unproven values Some companies, particularly small ones for which such payments are a substantial part of their R D expenses, may separately identify such transactions as purchase of in-process R D. 6Nevertheless, even when such transactions are separately identified in annual financial statements, it is unclear how the transactions are treated when companies report their expenditures through surveys such as those conducted by PMA. 

Accounting standards require firms to record as current expenditures all outlays for R D, advertising, and promotion when in reality these expenditures are investments whose payoffs may be delayed or extended into future accounting periods. The value of the intangible assets produced by these investments is too uncertain for use in accounting statements. Thus, the book value of assets in a company s financial statement underestimates the true value of assets, especially when these investments are important components of the company s activities, as in the pharmaceutical industry (62,78,80). 

Capital asset A tangible or intangible asset intended for long-term use. 

Measuring the value of intangible assets is really about estimating how closely aligned those assets are to the company s strategy. 

In some situations, this arrangement makes sense. But these situations are fewer and fewer. So the process of change should bring a review of the intangible assets and proposed alternatives when the existing assets are underperforming. 

Kaplan, Robert S. and Norton, David P., Measuring the strategic readiness of intangible assets. Harvard Business Review, February 2004, pp. 52-63-... 

Ibid., 384-385.1 cannot overemphasize the importance of the trademarks. On this subject see Mira Wilkins, "The neglected intangible asset The influence of the trade mark on the rise of the modern corporation," Business history, 34 (Jan 1992), 66-95. 

Caves, R.E. and W.F. Murphy, Franchising Firms, Markets And Intangible Assets, Southern Economic Journal, 42,4 (1976), 572-586. 

Human Capital Risks Human capital is the collective skills, knowledge, or other intangible assets of individuals that create economic value for the individuals, their employers, or their community. Related attributes are habits, social skills, personality, creativity, leadership, etc. An organization loses human capital through job turnover, theft of intellectual property, non-commitment to group goals, and other means. 

Lessors of Nonfinancial Intangible Assets (except Copyrighted Works). 

Operational risks Many times the risks are associated with the execution of business functions of a company. It includes risks of tangible and intangible assets. These risks address not only cost, efficiency, and contracting issues but also business disruption risk and misalignment of supply chains. 

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