TABLE OF CONTENTS Annie Green, D.Sc.
The framework of intangible valuation areas (FIVA) represents a dynamic relationship between strategic objectives of knowledge management and value drivers of intangible assets. FIVA provides a view of intangible assets within the context of the business enterprise, supports their valuation based on a common set of business dimensions, and supports the surfacing of measurement and performance indicators of intangible assets based on a common set of business dimensions.
When nearly two thirds of the companies in the world s largest economy have accepted the need for change, we no longer have an interesting new trend, but a revolution. (Edvinsson and Malone, 1997, p. 7).
Businesses have transcended through a myriad of changes as they have evolved through the agricultural, industrial, and information ages. These evolutionary changes have significantly changed the way businesses operate and have affected the relative value of its existing value components. Intangible assets have surfaced as a major value contributor accounting for up to 70% of the value of a business enterprise (Sullivan, 2000; Hope and Fraser, 1997) and yet, they are not adequately represented in current accounting methodologies. Intangible assets, as a value contributor of today s business enterprise, have obviated previous accounting methodologies.
Intangible assets, the strategic key to a business enterprise s future, are invisible with respect to traditional bottom-line thinking and corporate practice (Rivette and Klein, 2000). Current accounting methods do not convey the relevant and timely information that is critical to the survival and success of today s business enterprises (Lev, 2001). Before the...
