“Intangible assets may be what drive the value of your whole company—the secret sauce the buyer pays more for,” Brenneman says. “But agreeing to the value of these types of assets and the rest of your business is often the biggest sticking point when selling a company.”

Intangible assets mean economic assets which do not have physical substance or form,or are not tangible. Intangible assets include brands, goodwill, customer relationships, software and intellectual property related rights.

A significant proportion of the difference between historical net worth of a company and its market capitalization/ transaction value in M&A transaction, is often attributed to the intangible assets. Investors, lenders, analysts and other stakeholders are getting increasingly alert to the importance and valuation of Intangible Assets.

Also, Ind AS 38 require impairment assessment of intangibles asset on an annual basis and whenever there is an indication that the intangible asset is impaired.

Resurgent has the expertise to help clients assess the value to their Intangible assets using valuation approaches and methodologies which are globally recognized.

The various categories of Intangible Assets are-

Marketing related: trademarks (brands), trade names, service marks, newspaper, mastheads, internet domain names, non-competition agreements.

Contract-based intangible assets: licensing and royalty agreements, advertising, construction, service or supply agreements, lease agreements, franchise agreements, employment contracts.

Technology-based intangible assets: patented technology, computer software, unpatented technology (know-how), databases, trade secrets such as secret formulas, processes and recipes.

Customer-related intangible assets: customer lists, order or production backlogs, customer contracts and customer relationships including non-contractual relationships.

Artistic-related intangible assets: plays, operas, ballets, books, magazines, newspapers, pictures, photographs.

Intangible asset valuation may be required for various reasons-

• Impairment Assessment
• Fundraising
• Joint Venture Negotiations
• Financial reporting under IND AS, US GAAP or IFRS
• Purchase Price Allocation or Business Combinations
• Internal Assessments
• Transfer Pricing/ Taxation
• Licensing and franchising