Intangible assets are recognised as highly valued properties. Arguably the most valuable but least understood intangible assets are brands. The International Standard ISO 10668 provides a consistent, reliable approach to brand valuation including financial, behavioural and legal aspects.
ISO 10668 specifies 3 types of analysis must be done during a brand valuation:
- legal analysis of the trademarks and IP
- behavioural analysis of stakeholders perceptions and response to the brand
- financial analysis of the current and future earning potential of the brand
The standard also sets forth 3 objectives of the valuer
- Transparency: others must be able to understand how the valuation has been conducted.
- Consistency: if other valuers use the same method with the same source information, they should be able to replicate the results.
- Independency: those who create the brand or have vested interests in the outcome of a valuation should not conduct it.
There are 3 approaches approved in the ISO 10668 standard: cost approach, market approach and income approach.
The income approach as 6 approved methologies.