How to evaluate intangible assets by income method

Income method is to calculate the value of intangible assets according to the economic benefits of intangible assets or the present value of future cash flows. Such as goodwill, franchise, etc. The key of this method is how to determine the appropriate discount rate or capitalization rate. Another problem with this method is that it is difficult to distinguish the economic benefits of intangible assets. In addition, when a technology is still in the early stage of development, its intangible assets may not have economic benefits, so this method cannot be used for calculation.

There is also a method to evaluate intangible assets: cost method. This method is to calculate the cost of replacing or rebuilding a certain type of intangible assets. It is suitable for the value calculation of replaceable intangible assets, and can also estimate the economic benefits brought by the reduction of production cost, raw material consumption or price, waste reduction and more effective use of equipment, so as to evaluate the value of this part of intangible assets. However, due to the influence of factors such as whether intangible assets can obtain or develop alternative technologies and product life cycle, it is difficult to determine the economic benefits of intangible assets, which limits the application of this method.

Due to the long history of market economy development in western developed countries, the market development is relatively mature and perfect. Under the influence of planned economy system, people's understanding and concept of enterprise value in market economy are obviously different from most people in China. In the transaction of market assets, the purpose of any investor is very clear, that is, investment is for the benefit. The success of an asset transaction and the transaction price depend on whether the asset can bring benefits and profitability to investors in the future, rather than the cost of buying and building the transaction assets.

For an enterprise, although the enterprise is composed of fixed assets, current assets, intangible assets and liabilities, they are by no means isolated and static, but an organic whole, and there is an extremely complicated interdependence and mutual influence among various factors. The value of operating enterprises does not follow the mathematical law of 1+ 1=2 because of the interaction of various assets and the influence of external environment such as society. Although investors also pay attention to fixed assets, current assets and liabilities when investing, they pay more attention to the operational ability and operational potential of enterprises in the overall assets.