Putting Numbers on Intangible Benefits

Intangible benefits have been a thorn in the side of information technology project valuation efforts. These benefits are often comparable to tangible benefits in magnitude, and so should not be ignored. Yet, unless we can attach numbers to them, it is difficult to combine them in a consistent way with tangible benefits to reduce the chances of underestimating the true value of a project. The lack of agreement in both theory and practice on how to treat intangible benefits suggests that it continues to be an unresolved yet important issue. In this paper, we suggest a disciplined way, based on system dynamics, to quantify so-called intangible benefits. Although it is not algorithmic, the method still has substantial structure and can be implemented and estimated to varying degrees of detail to suit project needs. The method is demonstrated by applying it to a cellular service provider context. A simple but key notion that is used to develop our approach is that of induced observability. Ithelpstooperationalizeintangiblebenefitsinawaythatfacilitatesquantificationforpurposes of project valuation

Resource consents - intangible fixed assets? Yes, but, too difficult by far!

Recent international attempts to draft an accounting standard (IAS38) which establishes the most widely acceptable treatment for intangible assets have sparked debate among standard setters, practising accountants and media analysts. Contentious issues include differing treatment for internally and externally generated intangible fixed assets, and the requirement for the existence of a ready market for the exchange of intangible assets. A further question has been identified, that of whether the ‘right to do something’, as in permission to act, is in itself an intangible asset and if so how should it be treated. An example of this is resource consents issued under the Resource Management Act 1991. The aim of this research was to investigate the nature of resource consents as intangible assets according to ICANZ disclosure and recognition standards and to determine the level of disclosure practised by companies listed on the New Zealand Stock Exchange. Disclosure of resource consent details as non-financial information would provide a significant proportion of the benefits involved in disclosing this class of asset while limiting the costs involved in the production of the information. We conclude that the details of resource consents held should be disclosed in the annual report as additional non-financial information, or as a separate schedule of resource consents held in the notes to the financial statements as per FRS1. This view is not addressed by the requirements of IAS38 or ED87 as this 'class of intangible assets' is not discussed at all. However, it can be argued that the omission of resource consents and other similar intangibles is contrary to the spirit of the true and fair view requirement of the Financial Reporting Act and Generally Accepted Accounting Principles (GAAP)

Fair value on commons-based intellectual property assets: Lessons of an estimation over Linux kernel.

Open source describes practices in production and development that promote access to the end product's source materials, spreading development burden amongst individuals and companies. This model has resulted in a large and efficient ecosystem and unheralded software innovation, freely available to society. Open source methods are also increasingly being applied in other fields of endeavour, such as biotechnology or cultural production. But under financial reporting framework, general volunteer activity is not reflected on financial statements. As a result, there is not value of volunteer contributions and there is also no single source for cost estimates of how much it has taken to develop an open source technology. This volunteer activity encloses not only individuals but corporations developing and contributing open source products. Standard methodology for reporting open source asset valuation is needed and must include value creation from the perspective of the different stakeholders.FLOSS, commons, accounting standards, financial reporting

Empathy Institutionalized: Sociocultural Dialogue as a Strategic Peacebuilding Initiative

A common adage used in psychological exploration tells us that “If you want to know the end, look at the beginning.” While typically employed to emphasize the importance of upbringing and environment on personal outcomes, this phrase can be equally applicable in examining the ways in which society has developed over time to produce our polarized sociopolitical culture of today. This work explores from an integrative psychosocial perspective the potential that exists in working to define a new “end” by shaping a new “beginning,” through going directly to the institutions that comprise our own beginnings— schools. Through a combined research lens of peace studies and developmental psychology, this presentation will examine in detail the capacities of sociocultural dialogue as a strategic peacebuilding initiative, specifically in the context of institutionalized education. Through initiating relevant, age-appropriate conversational opportunities for our youngest minds to encounter and understand difference, this method would thus essentially strive to serve as an embedded, ongoing strategic peacebuilding initiative that assumes a preventative rather than reactionary approach to conflicts in perspective. In using an interdisciplinary approach to both inform frameworks and measure outcomes of implementing developmentally appropriate sociocultural dialogues in early educational settings, we gain a heightened understanding of the ways in which these types of dialogues can contribute to increased levels of empathy—ultimately working, from the beginning, to pre-emptively instill qualities capable of bridging the divides which we have clearly seen to emerge in the end

Protection of valuable areas of local cultural heritage in sustainable development. Cultural parks in the Lodz Region

Cultural park is one of the forms, in which valuable areas and historical establishments are protected under the Polish law. Protection covers “space” in its entirety with elements of wild nature and man-made structures. Such spaces have been shaped by the history of human interventions into a unique and original cultural landscape, a complex spatial structure consisting of: passages (rivers, channels, roads, and borders), plains (meadows, fields, water reservoirs, and forests), and objects (natural objects and monuments). They ensure sustainability of development processes. In circumstances created by globalisation, investment pressure, and seeking short-term benefits, comprehensive protection of valuable cultural areas acquires special importance from the point of view of sustainable growth. The paper aims to identify valuable areas of local cultural heritage in the context of sustainable development on the example of cultural parks established in the Lodz voivodeship

Sports mega-events – three sites of contemporary political contestation

This article discusses the contemporary politics of sports mega-events, involving the Olympic Games and Fédération Internationale de Football Association (FIFA) Men’s Football World Cup Finals as well as other lower ‘order’ sports megas, taking two main forms: the promotional and the protest. There is a politics in, and a politics of, sports mega-events. The former focuses on the internal politics of the organizing bodies, such as the International Olympic Committee and FIFA. This form of politics has been written about elsewhere, and hence, there is no detailed discussion in this article about it. Instead this article offers a brief discussion of the range and number of sports mega-events since 2000, an assessment of the contemporary politics of sports mega-events, a focus on three main sites of political contestation – rights, legacy and labour, and finally, it offers conclusions about research into the politics of sports mega-events

Accounting for Intangible Assets: There Is Also an Income Statement

Accounting is often criticized for omitting intangible assets from the balance sheet. With value in firms of today flowing less from tangibles assets and more from so-called intangibles -- brands, distribution systems, supply chains, "knowledge capital," "organization capital" -- accounting is seen as remiss, with high price-to-book ratios as evidence. The remedy often proposed involves booking these intangible assets to the balance sheet. This paper makes the point that accounting is not necessarily deficient in omitting intangible assets from the balance sheet: there is also an income statement, and the value of intangible (and other) assets can be ascertained from the income statement. For example, although The Coca-Cola Company does not report its brand asset on its balance sheet (and trades about five time book value), earnings from the brand flows through its income statement. Thus the firm is readily valued from its earnings; the income statement remedies the deficiency in the balance sheet. Accordingly, accounting that calls for the recognition of "intangible assets" on the balance sheet may be misconceived. The paper explores the case where the income statement perfectly corrects for a deficient balance sheet, and the case where it does not. It then explores whether, in the latter case, accounting in the balance sheet -- by capitalization and amortization of intangible assets or carrying them at fair value -- could remedy the deficiency in the income statement (or makes it worse). The investigation involves an analysis and valuation of Microsoft Corporation and Dell, Inc., two companies presumed to possess a good deal of "intangibles assets." The paper is instructive, not only to those concerned with accounting issues, but also to analysts attempting to value firms with assets missing from the balance sheet. It shows how to handle the accounting information in valuation and how to deal with the perceived deficiencies, real or imagined, with respect to intangible assets. In the case of Microsoft and Dell, the reader can observe at how close one comes to their market valuation by using valuation techniques that use accounting information currently provided by GAAP