Accounting for Expenditure on Intangibles.

In search of a unifying measurement feature on which to base a more systematic and potentially comprehensive analysis of intangibles, this paper first analyses the economic and accounting properties of intangibles, and second, empirically evaluates managerial practices for measuring and analysing ex...

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Publicado en:Abacus Vol. 48; no. 1; pp. 104 - 146
Autores principales: HUNTER, LAURIE, WEBSTER, ELIZABETH, WYATT, ANNE
Formato: Artículo
Publicado: Wiley-Blackwell Mar2012
Acceso en línea:Ver este registro en EBSCOhost
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          HUNTER, LAURIE
          WEBSTER, ELIZABETH
          WYATT, ANNE
        affil:
          University of Glasgow Business School
          Melbourne Institute of Applied Economic and Social Research, The University of Melbourne
          UQ Business School, University of Queensland
      sug:
      ab: In search of a unifying measurement feature on which to base a more systematic and potentially comprehensive analysis of intangibles, this paper first analyses the economic and accounting properties of intangibles, and second, empirically evaluates managerial practices for measuring and analysing expenditure on intangibles. We present evidence from a survey of 614 large Australian firms that suggests gaps in the extent with which firms plan, monitor, record, analyse, and report on intangibles. Third, we evaluate the implications of our analysis and survey for accounting practice. Our evidence suggests GAAP has a role to provide guidance that helps firms identify and classify their expenditure on intangibles in ways that elucidate the strategic implications of the different types of intangibles for future output. A secondary step for accountants, after identifying and classifying the expenditure on intangibles, is to apply a capitalization test to distinguish expenses from assets. The current asymmetric treatment of expenditure on purchased versus internally generated intangibles is not supportable on economic grounds. However, economists identify weak property rights as a major cause of uncertainty associated with the outcomes from expenditure on intangibles, suggesting verifiable property rights is a unifying measurement feature on which to base a capitalization test for intangible assets.
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