The Relevance to Firm Valuation of Capitalising Intangible Assets in Total and by Category

By Jayne M. Godfrey, Ping-Sheng Koh. 2001

128 citations recorded by the source corpus.

Debate about the appropriate treatment of intangible assets can benefit from knowledge about the relevance of their financial statement capitalisation to valuation of firms. With rules permitting or requiring intangible asset capitalisation, Australia provides an ideal setting to obtain this evidence. This paper reports findings that indicate that capitalisation of intangibles is value-relevant for Australia's largest firms. Results indicate that investors place greater value on capitalised goodwill than on other categories of capitalised balance sheet items. Similarly, capitalisation of identifiable intangible assets adds value to large firms. However, research and development capitalisation does not affect the value of firms in our study.

Subfields: Accounting, Strategy and Management

View Paper: https://www.semanticscholar.org/paper/2f173d5397e78bd41ed58ac3d7375fe09c3b915c

How researchers see this paper

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In Accounting

1. Dianne Massoudi
2. David Cairns
3. Ross H. Taplin
4. A. Tarca
5. G. Iatridis
6. Eva K. Jermakowicz
7. Sylwia Gornik-Tomaszewski

In Strategy and Management

1. Dianne Massoudi
2. David Cairns
3. Ross H. Taplin
4. A. Tarca

Citations in the corpus

• IFRS fair value measurement and accounting policy choice in the United Kingdom and Australia (2011, background): “Studies suggest that revaluation of intangible assets provides useful information (Abrahams & Sidhu, 1998; Barth & Clinch, 1998; Godfrey & Koh, 2001).”