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- Title
Valuing the intangibles.
- Abstract
In remarks to a Federal Reserve Bank of New York conference on statistical needs in the 21st century, professor Baruch Lev suggests that between one-half and two-thirds of the total market value of publicly held corporations may reflect the value of intangible assets. Lev's stresses on forming new standards for recognition of those aspects of intangible investment that should affect the main body of a firm's financial statements for clearly disclosing intangible investments and their impacts. In order to explore alternatives to realized market value as the metric from which to subtract tangible book value to create a measure of intangibles, economist Jason G. Cummins uses analysts' profits forecasts, suitably discounted into the future, to create another measure of total valuation. Cummins constructs a sophisticated econometric model to estimate the separate impacts of tangible investment, information technology investment, and intellectual property investment on value.
- Subjects
INTANGIBLE property; INFORMATION technology; INVESTMENTS; FINANCIAL statements; LEV, Baruch; CUMMINS, Jason G.; COLLEGE teachers; ECONOMISTS
- Publication
Monthly Labor Review, 2003, Vol 126, Issue 10, p44
- ISSN
0098-1818
- Publication type
Article