Intellectual Property Valuation
Almost every business utilises or creates intellectual property in its everyday endeavours. In this highly competitive world it is crucial for a business to identify and protect its IP through Intellectual Property Valuation, so as to take full advantage and turn intangible assets into exclusive property rights. Once an IP audit has been conducted it is essential to protect the company's interest in these assets. There are several areas of protection available. These are:
Valuing the commercial potential of Intellectual Property assets requires both an understanding of the scope of the IP and the business sector in which the assets could be exploited. The primary reason for Intellectual Property Valuations IP is to maximise its value and therefore the value of the owner organisation through optimum management decisions.
Valuing Intellectual Property
Intangible assets have increased from 17% to 81% in 34 years as reported by the S&P 500. Do you know what yours is worth?
Valuing the commercial potential of Intellectual Property assets requires both an understanding of the scope of the IP and the business sector in which the assets could be exploited. The primary reason for valuing IP is to maximise its value and therefore the value of the owner organisation through optimum management decisions.
The Australian Accounting standards Boards standard AASB 138 deals with the specific aspects for intangible assets. To meet the definition of an intangible asset, an asset must be identifiable to distinguish it from goodwill. To be identifiable the asset must be separable or arise from contractual or other legal rights. Separable means that the asset is capable of being separated from the organisation and is able to be sold, transferred, licensed, rented or exchanged, either individually or together with a related contract, asset or liability.
Our approach to Intellectual Property valuation is straightforward. We strive to comprehensively understand your assets and specific situation before beginning our analysis. Once we have a thorough understanding of these important factors, we carefully conduct our research and analysis so that it captures all relevant inputs and considers all possible aspects necessary to provide you with accurate, useful and complete information.
We understand that IP is unique. Therefore, a "one-size-fits-all" approach is unable to provide you with the precision you need. We believe in providing professional, competent and thorough analysis that is specific to the client's needs on each Intellectual Property valuation project.
Intangible Asset valuation in general, and Intellectual Property valuation, are specialised processes derived from financial and economic valuation concepts. To determine the value of a specific instance of Intellectual Property (such as a trademark, patent or copyright), we rigorously apply appropriate methodologies in accordance with recognized Intellectual Property valuation principles.
Valuations are necessary in many contexts. These may include investment analysis, capital budgeting, merger and acquisition transactions, financial reporting and taxable events, as well as bankruptcy and litigation proceedings. Our analysis provides the necessary support for the strategic decision-making processes utilised by investors, management and counsel during these important events.
When valuing I.P. usually the income approach is utilised which takes into account the economic benefits of the asset (technology) , and the future revenue stream it provides , discounted into the present by the use of Net Present Value (NPV) or Discounted Cash Flow (DCF).