Common Categories and Purpose Valuation of Intangible Assets

Below are the common categorize that appraisers and economists generally do. The categorization used to classify and to identify the intangible assets. The common categorization of intangible assets are as follows:

  1. marketing-related intangible assets (e.g., trademarks, trade names, brand names, logos);
  2. technology-related intangible assets (e.g., process patents, patent applications, technical documentation, such as laboratory notebooks, technical know-how);
  3. artistic-related intangible assets (e.g., literary works and copyrights, musical compositions, copyrights, maps, engravings);
  4. data processing-related intangible assets (e.g., proprietary computer software, softwrae copyrights, automated databases, integrated circuit masks and masters);
  5. engineering-related intangible assets (e.g., industrial design, product patents, trade secrets, engineering drawings and schematics, blueprints, proprietary documentation);
  6. customer-related intangible assets (e.g., customer lists, customer contracts, customer relationships, open purchase orders);
  7. contract-related intangible assets (e.g., favorable supplier contracts, license agreements, franchise agreements, noncompete agreements);
  8. human capital-related intangible assets (e.g., trained assembled workforce, employment agreements, union contracts);
  9. location-related intangible assets (e.g., leasehold interest, mineral exploitation rights, easements, air rights, water rights);
  10. goodwill-related intangible assets (e.g., institutional goodwill, professional practice goodwill, perosnal goodwill of a professional, celebrity goodwill, general business going-concern value).

And what are the purpose to do an intangible asset valuation? Many individual reasons to conduct an appraisal of intangible assets can be grouped into categories as follows:

  1. transaction pricing and structuring, for either the sale, purchase, or license of the intangible assets;
  2. financing securitization and collateralization, for both cash flow-based financing and asset-based financing;
  3. taxation planning and compliance, with regard to intangible asset amortization deductions, abandonment loss deductions, substantiation of charitable contributions, and various other federal income taxation matters, as well as with regard to federal gift and estate tax compliance and estate planning;
  4. management information and planning, including business value enhancement analyses, identification of licensing and other commercialization opportunities, identification of spin-off opportunities, and other long-range strategic issues;
  5. bankruptcy and reorganization analysis, including the value of the estate in bankruptcy, debtor-in-possession financing, traditional refinancing, restructuring, and the assessment of the impact of proposed reorganization plans;
  6. litigation support and dispute resolution, including marital dissolution, infringement, fraud, lender liability, and a wide range of deprivation-related reasons (e.g., breach of contract, expropriation, etc.)

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