New practical approach to assessing and reporting of Intellectual Capital Structure

Intangible Assets - Evaluation and Reporting


Dear Sir/Madam,

My Name is Kirill Kretov and I am working on my Doctoral Research – “Evaluation and Reporting of Intangible Assets (Intellectual Property)”. I have identified various theories and methods on the evaluation of Intangible Assets, origin of goodwill, and measurement of Intellectual Capital and potential. As far as I can judge, all of these theories, concepts and models are more theoretical than practical.

So I contact you today in order to collect your opinion on some points. Your experience which I hope you would be kind enough to share with me will certainly help me in assessing better my thesis. Please may I ask you to take 30 minutes of your precious time to complete the attached questionnaire?

Please, send all your replies to
Thank you for your help and support!


Please read, before you begin the questionnaire.

  • For any question provided we try to give all possible responses. If you don’t find one that corresponds to your case, you are free to add it. We greatly appreciate any comments that may clarify your choice.
  • If you don’t know or don’t want to answer question, just skip it. (You are free to skip any question).
  • Answers to this questionnaire will never be published or otherwise become public. Only statistical data that came from analysis of all received responses.
  • If you know any other person in your company who can give answers to this questionnaire, please send him a copy. It will be greatly appreciated, since it is very useful from the statistics point of view (I am interested in opinions of anyone involved in capital decision making and knowledge management).
  • I ask your permission to mention your company name in the list of surveyed companies that will be mentioned in my dissertation. (Check the box below if you agree)
    I agree
  • I ask your permission to mention your company name in the list of surveyed companies that will be mentioned in my dissertation. (Check the box below if you agree)


Less than 10
Between 10 and 100
Between 100 and 1,000
Between 1,000 and 10,000
More than 10,000
Less than 1 million
Between 1 and 10 millions
Between 10 and 100 millions
Between 100 millions and 1 billion
More than 1 billion

Evaluation of Intangible Assets

Every Day
Every Week
Every Month
Every Year
Income-Earnings (Discounted Cash Flow, Direct Capitalization Methods, Residual Income Method, Royalty Costing, etc)
Market-Comparison (Internal Transaction Price, Similar Product Price)
Cost (Original Cost, Book Cost, Replacement Cost)
Experts’ Opinions (Including various IC valuation concepts, such as Tobin Ratio, IC-Index, Scandia Navigator, Asset Monitor, etc.)
Recognized in accounting (mainly in IAS-38) Not-recognized in accounting
A. Trade marks
B. Software
C. Licenses and Franchises
D. Patents
E. Copyrights
F. Service and exploitation rights
G. Recipes, formulas, models, projects and concepts
H. Source Codes and documented algorithms
I. Acquired Goodwill (IAS-3)
J. Expenses on training and education
K. Advertizing Expenses
L. Reorganizational Expenses
M. Research expenses
N. Stuff (Personnel) skills and abilities
O. Technical knowledge
P. Market share
Q. List of clients
R. Brand names
S. Internal Goodwill
  Add your items (not listed above, but you think that should be)
  Income Market Cost Expert
The choice of format should be decided by reporting company
The format should have a recommended structure
The format should be strictly regulated
Your option:

My Concept for Reporting Capital Structure

In this part I would like to share with you my concept of graphical reporting of capital structure that I developed through my research. I find it very applicable for the purpose of fast analysis.

Below you can see the two traditional formats of capital structure reporting: table and hierarch-tree diagram.

1. Table (with color codes)

K.Chart Table

2. Hierarchy tree (with percent values)


Hierarchy tree is generally superior to table representation, because you can visually see the hierarchy of resources. A percent figure next to each block to signify its value within the total capital.

The same capital structure in a format of K.Chart, may look like:

3. K.Chart13 (with full text comments)


Note, that comments (text blocks) can contain any information (absolute values, descriptions, etc). In the graph below full text comments were replaced with code names

4. K.Chart13 (with codenames)


The graph becomes more compact, but information about resources is now masked and can only be decoded by someone who has a decoding table (refers to the first table in this section, column “code”).

Benefits of using K.Chart

‘K.Chart” presents a class of graphs that give a lot more possibilities for capital structure representation than any other type of graphs, because it simply allows more informational dimensions (graphical methods of data representation):

  • Layers that represent hierarchy (normally, during analysis one doesn’t go below the 4th)
  • Sub-elements for each layer – located just above their parent.
  • Size of area of each sector – volume (relative value). Principle is similar to pie charts.
  • Color code (Currently not in use, except it clearly separates one resource from another).
  • Graphical Comments (Can be of any complexity, but recommended is between 3 and 30 characters)

Graphical Comments (Can be of any complexity, but recommended is between 3 and 30 characters)

Another example

Below you can see an example of some hypothetic company with almost 200 groups of resources identified on the graph. There you can see different scales, use of full text comments and of code names. Charts that are not marked with “complete” have a size constraint – the total value of group of resources should be minimum 1% of total capital.

1200x 1200px
3966x 3968px
3966x 3968px
2794x 2796px
2794x 2796px

Note that the final picture only represents a structure of the sub-sub-element ("Organizational Resources" within "Intangible Assets"). For the total capital structure reporting there should be about 5 graphs like this one. The complete capital structure in a format of opimized hierachy tree can be found here (1400x6345px)

In my experience we have built the capital structure of more than 30000 (thirty thousands) entries, the printed graph was about 16 square meters.

You opinion on “K. Chart”

a. Hard to prepare data necessary for the graph
b. Hard to draw a graph from the data collected
c. Hard to understand what graph represents
d. Classification of assets should be different
Clearing Partners
Operating Systems
Partner Markets
Column / Bar
Line / Area
Pie / Doughnut
Hierarchy Tree
Excel Table (no colors)
Excel Table (colored)
Textual Report
Reduced error rate
Easier spot analysis (mainly comparison)
Makes trend analysis possible
Simplifies preparation of reports
Enhances perception (understanding) of reported data
Clear (understandable)
Your option:

Open-ended Questions

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