Classification of intangible assets:– Inventions, inventions, formulas, processes, models, skills, trade secrets. – Copyrights and literary, musical and artistic works. – Trademarks, trade names, trademarks, product identification characteristics. – Business rights, licenses, contracts. – Methods, programs, systems, procedures, surveys, research, forecasts, estimates, customer lists, technical data. – And other types of intangible assets (such as human resources, business location…). Appraisal of intangible value for equitization of enterprises or calling for investment capital, franchising…Companies today have developed the brand valuation model into a very effective management tool. DVC’s intangible appraisal service we will help businesses quantify hidden intangible value, assess potential and development, establish an intangible fixed asset management system of enterprises on the Internet. the value base effectively exists.
Valuation purpose:– Purchase, sale, transfer, pledge, mortgage, bank loan. – Determining the value of assets for litigation – Calculating tax and accounting books, financial statements. – Investing and contributing capital to enterprises and shares. – Determination of investment value.
ASSESSMENT OF VALUE OF INTANGIBLE ASSETS UNDER INTERNATIONAL STANDARDS
Step 1: Check the legality of the propertyBefore determining the value of intangible assets, we need to determine whether this asset has been registered for value and protected by any unit or not? How will this property after the registration of the value be protected, for how long and how much it will cost to protect, because if the valuation is completed, and the property is not protected, the property will not be protected. that no longer makes sense.
Step 2: Identify specific circumstancesWe need to make initial assumptions and assumptions before going into the calculation as well as choosing the method determining the value of the property.
Step 3: Collect relevant informationWhere the property is expected to be of high value, the evaluator should gather additional relevant information for the valuation process, which may include the following: – A list of all objects of value that are relevant to the property we are valuing. – The relevant business plan when putting this property to use, market research as well as from competitors on this property. – Gather objective assessments from independent individuals, from experts… – Litigation or related disputes. – Synthesize economic data or statistics, about the industries to which this property is related. – Cost information related to the creation or invention of this asset. – Other information.
Step 4: Gather from a team of assessorsLearn from experts on thelaw related to the registration and protection of the value of the property after valuation, initial perception of the degree of exclusivity of the property, understanding of technology applied to create the real value of the property. From these insights, the contents need to be gathered to form the basis of professional valuation.
Step 5: Research carefully about this intangible assetAfter we have the relevant information, we conduct a thorough research on intangible assets, need to understand the creator’s name, which group the property belongs to, the unique properties of the property… to determine determine the expected useful life of the asset.
Step 6: Research the scope of intangiblesThe scope of the intangible asset is to determine what areas this asset will apply to, which spaces, under what conditions … this is an important basis in calculating the value of this asset.
Step 7: Talk to a lawyerWe also need to consider and discuss with a lawyer who is knowledgeable about this property, because the influencing factors as prescribed by the “law” also have an equally important influence on the value of the intangible asset after determining the value of the intangible asset. .
Step 8: Determine the validity of the propertyWe need to determine the validity, legality of this property, because if in the case, we have lost a lot of time and costs related to valuing and conducting disclosure of the property, however if the court finds argue that, if the investor of this property has not met the requirements of the law or the specific law, the property will automatically lose its full value.
Step 9: Zoning the intangible assets of the business itselfDue to the unique nature of intangible assets, there is no specific form. Therefore, it is not advisable to simply assume that the business that owns this asset has the right to use that asset in reality, because simply, if not careful, this property may be used by someone. else, and of course, it will no longer be valid. Therefore, we need to notify an attorney or competent authority about the existence and existence of assets held by our own business.
Step 10: Consider the property registration industryNext we need to look at the industry or sector in accordance with regulations to determine how similar intangible assets were valued, the basic differences and similarities, as a basis for valuation.
Step 11: Find out about this property in other countriesAs intangible assets are often created not only for use within the business, but for use in other regions or countries. We need to find out how much it applies to have the most general information about the use of the property, and the more used the property, the higher the value.
Step 12: Consider the useful life of the assetIn addition to considering the useful life of an intangible asset from a legal” point of view, the appraiser needs to consider the use in terms of economic, technical, social as well as actual circumstances. For example, in Vietnam, according to the provisions of the Intellectual Property Law, the copyright of a book with a specific author’s name will be protected indefinitely during the use of this book.
Step 13: Analyze pre-existing intangible assetsAfter determining the time, it is necessary to collect and record the registered cases of similar properties, how much the value is, in order to have a basis for determining other basic points as a basis for valuation.
Step 14: Research and investigate property-related lawsuitsIt is easy to see that, if it is determined that the assets we have and hold are owned by us, without any related lawsuits, the property value will inevitably increase accordingly.
Step 15: Select method basic valuationDepending on the regulations of each country, there will be different methods of valuation, and of course each method will have certain advantages and limitations. In Vietnam, according to Circular No. 79/2002/TT-BTC dated September 12, 2002, the value of assets in particular and the value of enterprises in general can be determined by one of two main methods: (1 ) the asset-value method and (2) the discounted-cashflow method; Particularly for intangible assets, it will be calculated according to the residual value in the accounting books.
Step 16: Determine the demand curve for the intangible assetThe valuer estimates the demand generated by using this asset to draw the corresponding demand curve. The key question in the investigation and information gathering process at this stage is: what are the expectations of the users and the revenue that can be obtained at various prices?
Step 17: Determine the equilibrium for profit maximizationThe valuer must determine the unit price to maximize profit by following these steps: – First, calculate and determine the marginal revenue curve from the determined, investigated and drawn demand curve in step (16) above. The MR curve will describe the change in total revenue generated by selling one more product at any given unit price. Second, estimate the amount of costs that will be incurred at different levels of production, and from this information a marginal cost curve is drawn. Information on the MC curve can be gathered from cost accounting information and/or from technical research related to the cost of producing a product. – Third, after determining the MR and MC curves when there are intangible assets, the valuation staff will draw a graph to determine the equilibrium point in maximizing the profit of the business. Let’s see the graph below, at company ABC, if the business has an intangible asset, it can sell 2,500 products at a price of $ 35 / product. However, if the business does not have intangible assets, due to the objective impact of the market as well as the pressure from competitors, these will reduce the product price to only $ 10/product. , that is, the intersection of the demand curve (D) and the marginal cost curve (MC). And when analyzing according to this process, we will determine an optimal price, the point that will bring maximum profit for the company.
Step 18: Identify the secondary factorsAfter determining the main factors, it is necessary to consider other factors that may affect the value of the intangible assets that the business is holding. Specifically, the following factors should be considered: (1) the rate of depreciation of the asset over time, (2) the rate of development of micro and macro factors in the market economy, ( 3) relevant competitors, (4) future cash flows from the asset’s use.
Step 19: Synthesize the valuation processAfter gathering all the collected information and data, based on the valuation method, calculate and determine the relative value of the intangible assets that the enterprise holds, so that it is consistent with expenses and will bring maximum profit for the business.
Step 20: Prepare valuation reportIntangible assets, after having a specific value, should be reported to accurately reflect the valuation process, the assumptions and assumptions that arise, the basis of calculation, the limitations or limitations of the valuation as well as as value conclusions are obtained. At the same time, this report is also sent to the competent authorities to recognize in terms of value and guarantee the ownership rights and the term of protection for the owner of this business. In summary, the process of valuing intangible assets is a difficult and complex process that requires information synthesis, technical analysis as well as highly specialized techniques. However, the benefits brought from intangible assets are very large and contribute to the success of the business. Therefore, businesses can consider and apply to be able to determine relatively accurately its value in order to improve the value of the whole enterprise and competitiveness in the current market economy. now on.
- Certificate of business registration
- The tax registration certificate
- Decision on establishment of affiliated units
The enterprise valuation process complies with the price appraisal process in the Valuation Standard No. 05 promulgated under the Decision No. 24/2004/QD-BTC dated October 7, 2005 of the Ministry of Finance. In general, the business valuation process is similar to the valuation process of other assets, but the specific content of the steps needs to be tailored to the business valuation. The business valuation process includes 6 steps: