Appraisal Foundation Issues Valuation Guidance on Contributory Asset Charges Used in the Fair Value Measurement of Intangible Assets
Recently, the Appraisal Foundation announced the release of a publication, The Identification of Contributory Assets and Calculation of Economic Rents, on best practices for valuations in financial reporting of intangible assets. The publication provides nonauthoritative guidance on contributory asset charges (also known as capital charges or economic rents), which are often important for entities to consider in applying an income approach (e.g., the multiperiod excess earnings method) to estimate the fair value of an intangible asset. The guidance was developed by the Working Group on Contributory Asset Charges sponsored by The Appraisal Foundation. A copy of the publication and a related toolkit of illustrative examples are available on the Appraisal Foundation’s Web site.
