Financial Risks and Intangibles

Financial Risks and Intangibles

David Ceballos (University of Barcelona, Spain), Ada Ch. Quesada (University of Zulia, Venezuela) and Dídac Ramírez (University of Barcelona, Spain)
DOI: 10.4018/978-1-60960-054-9.ch014
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This chapter briefly analyses the potential impact of financial risks on the valuation of intangibles from a theoretical and heuristic approach. The authors justify the financial risk that has the greatest impact on the value of intangibles for a wide range of intangibles and types of valuation models. Four types of financial risks are considered for the analysis of three principal types of intangibles (resource, capacity and asset). The authors present a study applied to six examples of intangibles and eleven categories of valuation methods. The results are coherent with the literature because the common examples of valuation of intangibles use the recommendable methods according to the lower impact of financial risks.
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This paper is not a comprehensive literature review of the field. Instead, it covers part of the financial literature on intangibles that has not been highly developed theoretically.

Sveiby (1997), Ross (1997), Fernández (2004) and other authors analysed the definition and valuation of intangibles. Although they also addressed financial risks, they did not analyse the relationship between these factors. In some previous and unpublished papers, Ceballos, Sorrosal and Ramírez (2006) worked on the financial basis of intangibles, on which this present paper is based.

We present a standard analysis (Institute of Risk Management/AIRMIC/ALARM, 2002) of the financial risks considered in Basel II (Bank of International Settlements, 2004) applied to intangibles (Lev, 2001).

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