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  • Writer's pictureLiviu Cotora


A tacit knowledge that we make explicit and is considered helpful in an activity let’s say in a project, is a value contribution and because we obtained a fair value compensation, it is an Intangible Value Transaction.

If one or many persons involved in building or developing a Partnership set-up a business model or procedure increasing the value contribution of this partnership to the total value create by the Firm and so the market value of the firm, then these is a value contribution.

If the contribution was compensated by an certain amount of value units negotiated with the purchaser of these intangible value, who had the choice to say “no”, but he appreciate that Value, like being important to his value creation process, which is important to the company whole market value creation process, so the Intangible Value Transaction has a “Fair Value” “payment “ in a competitive market inside the Firm.

Many other teams (value centers) or just a person can make similar contribution which are not in the job description, are not planed and not time and cost budgeted, and more, these contributions are creative, are not copied on a documented existent knowledge inside or outside the Firm.

Installing an open Intangible Value Contribution Market inside the Firm stimulates the personnel to go involved in the challenge of bringing solutions to problems which are not in their direct responsibilities, it also brings creative potential to the Firm.

The rewarding of the contribution with “Value Units”, which can, and must be at the end of a period of time be converted in remuneration extra from salary, but also in better positions in the Firm, these creates a highly dynamic environment inside the Firm.

The high interest projects are visible, the knowledge tacit and explicit existent and the competencies in the Company around the challenges, and treats, will give a big Intangible Value Production and rapid solutions.

The Intangible Assets Accounting installation in the Company despite certain reluctance regarding: new technology, new augmented finance, additional organizational steps, lack of experience and some additional cost, is finally a huge advance for every Firm. Is like economical impact discovering and applying Steam engine or Electricity or information and computer in business, all these had drastically consequences on the Business models, and waiting to act, means to die.

Intangible Assets and Values Accounting “is   Augmented Reality to Plan and Manage the Enterprise Resources”, is like discovering that our Planet is not flat, and planning the trade and business to more new continents and countries.

Today already most all the companies have much more Intangible Resources Assets and Values Flows than Tangible Resources and Tangible Values Flows

Augmented Enterprise Resources means Tangible and Intangible Resources

The Business process Model is generally the normal way to spread Intangible Value Centers, because the Business Value created a long a business process is integrated Tangible and Intangible Value.

The Accounts in the Tangible Accounting system are also related to the Tangible Value Flow, financial or products, assets, equity. In the Intangible Accounting system is similar, the Value Centers are spread around the rings of the process Value chain. Setting Value Center per Value ring can help to check the real creation Value of the chain, ring by ring and check how useful is each ring.

  Checking the Intangible Value Contributions per ring can facilitate each business process remodeling, digitalizing, reshaping and measure the effect.

Already Firms understood that planning the production is just a part of the managing challenge but assuring the market demand for his products is crucial, perfect planning for less sales is not an issue to boost company market value and either to keep quality peoples involved.

Customer sentiment, market reputation, but also sustainability-based values, are complementary to the Enterprise resources Tangible Values and Assets.

Building successfully Customer Relations following a business secret “receipt” is Intangible Assets, and we need to build a Value Center around him. The Value Contribution to build successfully customer relation is not exclusively coming from the sales area or financial area it can be others person or community with great ideas, if the CRM or sentiment software doesn’t treat them, we lost Intangible Value.

So, building Value Center with the community in charge with the specific customer relation, will stimulate each active person involved in Firm success to create and contribute and be rewarded for the validated contribution

We see and measure how much we increased these and from where are coming the Value Contributions, how we can stimulate them, in short, the adagio is “we measure, we manage”

Competitive advantage internal production is also crucial for each company staying alive. Most of the competitive advantage is structured around business secrets, copyrights, patents, original usage and special partnerships build around these, all of them Intangible Values and Assets.

There is no software managing these corporate key resource, “Competitive Advantage”. It is a high complex process, but isn’t a chain of events on the time axes.

Each person, competence, tacit or explicit knowledge, business relationship, of course IP Assets, can be part of it.  If we want to manage it, we have to build the Values Centers containing the Value Contributions involved in “Competitive Advantage “, validated and remunerated through impairment Fair Value process

This is the way to monitories the degree of the “Competitive Advantage” and to check against the Market Value.

  There are a lot of software and practices involved to identify, develop and measure such values like : customer sentiment, brand and reputation ,  and these is the hot sale today even for the traditional ERP vendors but without an Intangible Assets Accounting able to COUNT the Intangible Value Firm production and consumption is like whishing to manage Tangible resources without an Accounting system.

The Value Centers are created to track and measure the Intangible Value Flow inside the company, like in the Tangible Value Accounting the accounts are tracking the money and tangible products flows like: revenues, expenses, deliveries, but also investment, provisions.

  The many accounting rules makes the accounting reports comparable between companies and the audits can have a formal and legal basis to explain the different values existing in the financial reports, this must be the case also for the Intangible Assets Accounting.

Value center in Intangible Accounting are different types:

  • Competitive advantages production, also called Internal Production

  • Partnership, brand, market building alliances, these is called External Production

  • Sold production, everything the Firm sold

In all of these Intangible Values  classes we create Value Centers able to create measurable and legal accepted Intangible Values and Assets.

Part of these Intangible Assets are already existing and legal documented and reported like patents, copyrights, these is just a part of the Firm Intangible Accounting and even these Intangible assets can be better managed through V Value Center containing formalized Intangible Value Transactions , which can be considered legal support of any kind of patent or copyright defending or violation act.

For software legal author right, the different new versions are add-on software and like different extensions the author right can be disputed, even internally the different Value Contributions can be transparent reported and analyzed to fix disputes.

The Value Center is also organized by Value type; knowledge, competence, partnerships, and tangible production like result of the Intangible Value Production.

The Tangible production from an Intangibles Value Center can be: computer software, a method and concept description to sustain it, business certification opening market rights, trademarks, drawings, books, Every Reality, identified, that can be clearly defined.

The Knowledge Value Center is containing explicit knowledge developed internally or not, and necessary to improve the Intangible and Tangible Value creation process in the Firm. The Knowledge Value Center are normally the starting point when the goal is to create an Activity Value Center, or an Intangible Assets, with a big Value impact on the Firm. The Knowledge Value Center is the Company Neuron, and together with all the Value Centers they represent the Firm Neuronal Network.

The Firm is a Brain, the new technology AI, digital economy, RPA with 3 million Bots running in enterprises in 2020, algorithm-based functioning, IoT, deep learning in knowledge fostering, the whole Firm is producing Knowledge and competences.

Value Contribution Flows are the deep footsteps for the Firm Artificial Intelligence level, quality and quantity of the Value Contributions containing in the Intangible Value Flows are the Real Map of the Firm deep learning existent operational process.

Knowledge is very important to vitalise the company creative activity, and is normally the important source to send Value Contributions to the next level of Knowledge transformation which is Competence Value Center.

Competence is a structured form of an explicit knowledge formalized with best knowledge transfer mechanism including the best practices in applying the explicit Knowledge in the activities on a sufficient period in time to improve and correct the explicit Knowledge.

Deep learning neural networks is the Firm with the Intangible Value Centers implemented in an integrated management system.

The knowledge filter and correction are made through a loop circulating the report “after action “key points in knowledge and competence expressions, training support and instructions updated permanently.

  Competence is the Intangible Value, used to fuel activity, obtain repetitive quality activity productivity and obtain Value from new activities or by new way of acting or acting with new technology.

Each Activity Value Center has normally a Competence Value center where we can send the Value Contributions “after action” and so to speed up the increasing competence cycle, very necessary to create the global Firm Intangible Market Value.

During my consultant mission I meet a big Oil industry giant with no more than 24 hours cycle between “after action” report and output of the reviewed version of the training on action instruction release.

This update was released immediately on all action places on the planet, productivity rise more than 80% average on certain activities related to the oil extraction phase, but specially in new workplaces with low personnel competence

These “Action – Knowledge-Competence” cycle was considered a high Market Value Intangible Value Asset for the Oil Company.

My mission is most to pre-configure the Intangible Value Centers and their role and value units, so is to design the Intangible Value and Assets Accounting system, the implementation will be done in the customer own technology, like an accounting counsellor pre-configuring the Accounts necessary for the different assets classes operations in specific business transactions

Partnership Value Center is built around a key Asset which fuel the value creation in the partnership, that can be:  contracting business model, calculating algorithm or Smart contract process in which we melt, competitive advantage competence or knowledge with contracting responsibilities both sides. These Partnership Model is an Intangible Asset

If we create an “go-to-market” special business model with special Knowledge and competencies, but also special software configuration and procedures than we have to build a Value Center or more

We will build also a Knowledge Value Center and Competence Value Center to fuel the “go-to-market” action and create more Intangible Value around these Intangible Assets.

The Mc ‘Kinsey “Lighthouse” business Model can be an example of an Intangible Value Asset Accounting system with several types of Value Centers: knowledge, competence, partnership; spread through different types of productions: Competitive Advantage, alliances, partners, customers, but also supply-chain, manufacturing.

Let’s take an example how we treat the Intangible Assets Accounting around a project like “implementing a new technology” let’s call him project “A”.

Because it is a new technology, we have little experience inside the Firm, of course that we make the most of the implementation with an external partner but certainly we need to create the knowhow and the competence to understand, control and manage the system, and we wish procedures for all these future necessary activities;

The value Centers that we create are:

  • VC knowhow project let’s name VCkA

  • -VC competence project VCcA

  • -VC partnership project VCpA

  • -VC tangible project VCA

A Value Center means an important activity with impact on the Firm Market Value, so create knowhow is crucial and is the most important starting point for generating Intangible Value and converting in Intangible Assets.

The Intangible Assets Accounting prepare a Firm to capitalise the huge Intangible Value created through his day by day operations but also to count and manage the Intangible value creation and continuum conversion process in tangible Assets.

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