Intangible Assets

Wall Street Journal  Mar 22  Comment 
How to value intangible assets like brands, data and algorithms is a growing issue with investors and a knotty problem for accounting rule makers as companies rely on such assets more in marketing and product development.
Motley Fool  Feb 29  Comment 
Accountants amortized intangible assets just like they depreciate physical capital assets.
Forbes  Nov 13  Comment 
There are growing signs that the Cleantech sector will suffer a reversal. The reliance on intangible benefits to promote technologies complicates due diligence.
Forbes  Aug 15  Comment 
The fastest way to make your product tangible to the customer is to describe how it will make his life, specifically, better.  Jul 15  Comment 
Bellevue Group reports improved operating performance in the first half of 2015, extraordinary impairment of intangible assets Bellevue Group AG / Bellevue Group reports improved operating performance in the first half of 2015, extraordinary...
Forbes  Apr 27  Comment 
Turns out when you ask football people about quarterback intangibles they can cite very tangible actions that are the marks of great ones.
Forbes  Apr 17  Comment 
An app for iPads and iPhones called SportsBoard allows college coaches to better evaluate recruits because it quantifies several intangibles.
Euromoney  Feb 25  Comment 
Innovation is held back by the gap between the old financial system, investing and lending primarily against hard assets, and the new knowledge economy that depends on intangible assets. A new type of bank could benefit SMEs seeking to develop...
Forbes  Oct 2  Comment 
Increase the value of your business by paying attention to your intangible assets—more than 80% of your company's value—with these 4 tips.
New York Times  May 4  Comment 
The wildly divergent paths of the top two picks in the 1998 N.F.L. draft have become shorthand for the frustrating process of identifying character traits that lead to success.


Intangible Assets are non-physical assets on a company's balance sheet

Intangible assets are assets that cannot be physically seen or touched. In general this includes things like intellectual property (such as patents and trademarks), brand recognition, and trade secrets. On the balance sheet, intangible assets add to the total asset value and, as such, are a component of the total book value.

While the value of intangible assets is harder to calculate than physical assets such as equipment or factories, intangibles have no less real value than their physical counterparts. There are several methods used in calculating the value of intangible assets, all of which rely on an accountant or accountants' estimates of worth.

In most cases, GAAP does not allow internally generated intangibles to show up on the balance sheet. For example: Coco-Cola corporation would not list the value of its brand on its balance sheet. On the other hand, if a company pays more than the fair value to acquire another company, the difference is shown as goodwill in the acquirer's balance sheet. Also, research-based companies, such as drug-manufacturers, are allowed to capitalize their research and development expenses -- since, in theory, research provides value long after it has been completed.

Some intangibles are amortized, i.e. written off, as expense over time. Under the U.S. GAAP goodwill cannot be written off as expense unless the company has a reason to believe that it has reduced in value. Amortization of intangibles decrease income of the company and hence offer tax benefits.

It should be noted that goodwill, while technically itself an intangible asset, can be listed separately on the balance sheet. In other words, a balance sheet may list intangible assets and goodwill separately or together.

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