What is the award of intellectual property?
The valuation of intellectual property places value on the intangible assets of the company. Intellectual ownership includes creative items that companies own, such as trademarks, authorial and computer software. Innovative business subjects such as patents, industrial proposals and business secrets are also considered to be intellectual property.
The need to assess the value of intellectual property may be due to a number of reasons. One of the main reasons is if the company or owner of intellectual property wants to sell it to someone else. Another reason for the valuation of intellectual property is tax purposes where agencies such as the Internal Revenue Service (IRS) want to know the value of the property.
The introduction of the Standard of Financial Accounting 142, Goodwill and other intangible assets also changes the approach of intellectual evaluation for accountant purposes. With the introduction of this standard, the intangible camista assets are to balance the company's balance sheet. Previously, these assets have been processed using STanked period of amortization. In addition, IRS also wants to know how the owner of intellectual property has determined the value in the first place.
Two other situations where intellectual ownership is required is for financing and bankruptcy purposes. In addition to external resources that need to know how much it is worth intangible assets, companies also have internal real estate valuation needs. For example, if one of the assets is purchased or sold, a valuation of intellectual ownership is required for correct recording or sales in accounting records for the company.
In general, the award of intellectual property deals with the real market value of the asset. The real market value (FMV) is the price that will be a willing seller and willing buyer to exchange ownership of the asset. In other words, the real market value is the current value of the asset in the hypothetical situation. In addition, all parties involved in the transaction mustto know all the details of intellectual property, which is part of the award of intellectual property to make it as realistic as possible.
For example, if the company patented an invention that could save $ 1 million in the US (USD), then the valuation would be the amount of cost savings for the company. Realistically, however, the company will not pay for the patent for an invention equal to its cost savings. In fact, it gives the value of a patent to somewhere among US dollars $ 0 (USD) and $ 1 million USD (USD).