Transfer Pricing Intellectual Property: Operational Planning: Multinational Tax Accounting
Intangible Asset Valuation
|Intangible assets are crucial to business value and can generate
an income for a business in the same way that a house can generate a
rental income for the owners.
The cost evaluation method would determine how much it would cost to recreate an existing intangible asset based on the original cost of creating it and the potential cost to recreate.
In the UK business valuations lend as much as 80% of total valuation to intellectual property, goodwill and other intangible assets. Transfer pricing operational planning is recommended.
'Big 4' audit firms
Intellectual Capital means the intangible assets of a company (which include relationships, branding and reputation) which provide the route to commercialization through specific key skills, know-how and processes – for example, the performance of your business processes. Computing the true value of a company requires an accurate, defensible assessment of both types of assets --tangible and intangible property.
Sec. 482 of the United States Internal Revenue Code, for
Transfer Pricing in its entirety, states:
Operational Planning for Intellectual Property - IP and International Transfer Pricing
The laws that define and protect intellectual property span across three distinctly different areas: patent, trademark and copyright. Many business contain information that is of proprietary nature. It generates value from usage, research, development, design, etc. Therefore, the investment in that information product, knowledge product or the virtual product must be protected to encourage other similar research.
Methods for valuation of identifiable intangible assets including Intellectual Capital and intellectual property fall into three broad categories. They are market based, cost based, or estimates of past and future economic benefits.
Operational decisions about pricing concerns requires strategies and planning for intangible assets such as brands, intellectual property and licenses now comprise a greater percentage of the economic value of successful businesses than ever before. Some economists argue that intangibles represent the main performance drivers in the current transition from a traditional financial economic structure to a new knowledge-based economy. (Appraisal Economics Inc.)
A trade secret is a formula, practice, process, design, instrument, pattern, or compilation of information which is not generally known or reasonably ascertainable, by which a business can obtain an economic advantage over competitors or customers. In some jurisdictions, such secrets are referred to as "confidential information" or "classified information". (Wikipedia)
All confidential business information which provides an enterprise a competitive edge may be considered a trade secret. The subject matter of trade secrets is usually defined in broad terms and includes sales methods, distribution methods, consumer profiles, advertising strategies, lists of suppliers and clients, and manufacturing processes. While a final determination of what information constitutes a trade secret will depend on the circumstances of each individual case, clearly unfair practices in respect of secret information include industrial or commercial espionage, breach of contract and breach of confidence. (WIPO)
Best Method Rule of Transfer Pricing
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Transfer Pricing for the Automotive industry Ireland Internet Advertising Silicon Valley Advertising Internet Advertising Italy Japan China Ireland Competitive Advantage India Kevin P. Feyad