Finance and Accounting measurement of intellectual capital

Project description
Graphic representation of the relationships between the codes.

Follow the 6Cs to know the connection between cods.
Explores the relationship and connections between categories
Glaser (1978) offers the 6Cs tool:
? Context: in what context does this occur?
? Conditions: under what conditions does it occur?
? Causes: what causes it?
? Covariance: Do changes in any category cause changes in another?
? Contingencies: what is it contingent upon?
? Consequences: what are the consequences of the phenomenon?
Please see page 14(202) in document name: 17047879 (2)
So, you need to do the diagram with arrows .then write one page about the relationship

Measurement of intellectual is a big topic
Measurement of intellectual capital is a big topic
Existence of standards

Classification

Non-financial forum

Create non-monetary Value

Measurement difficulties

Measuring is very context specific.
Measurement depend on strategy

Chief parameters

Comparing two different intellectual reports

intellectual capital liabilities

Historical cost accounting

Employee turnover

the narrative with the number

financial focus

divide revenue

Management accounting

Structural capital

Relation capital

Boundaries

Human Capital

Problems and conflicts between academic and practitioner

Intellectual capital measurement explanation

human factor

Strategy

Assets

Liabilities

Expenses

financial gap

structural capital

problems between academic and practitioner in intellectual capital measurement
This is a big umbrella that cannot be easily answered unless you go deep to its parts.

To measure anything, people need standards and principles. Accounting Standards come from Accounting Standards Board.

Intellectual capital is normally classified to Three categories: Human Capital, Structural Capital and Relation Capital.

There are no Standards then what is intellectual capital. How can we deal with non-financial report?

Intellectual create value to any organization. This value is not restricted to dollar but it can be any things such as infrastructure and serves

Because of non-dollar value creation, it is difficult to measure intellectual capital; and if a company measure intellectual capital, it will be difficult for other to do the same.

When people measure intellectual capital they need to consider the context.

How to measure intellectual capital is depending on the organization goals and strategy.

If there are different ways to measure intellectual capital. So, what is the best parameter?

If the measurement depend on the company strategy then how people can compare different intellectual capital reports.

There is no one want to have intangible liabilities. Some intellectual capital creates moreexpenses and less revenue which will consider by a company as liabilities.

Follow the international financial report standards (IFRS) to evaluate the intellectual capital. For example, if the company bought a new systems , it will record is as expense on that financial year according to IFRS.

This is a part of human capital. How to measure the human capital is deferent from one organization to another. It is all depend on the context.

As accountants, we need focus on text and dollar. The separate of the leads to unreliable value of a company.

What are we focusing at when we are measuring intellectual capital from dollar prospective? What the benefit of measuring intellectual capital financially.

One of aspects that generate revenue is intellectual capital. So, can we relate and divide revenue to each parts of intellectual capital. This can helps us to know intellectual property worth more than the other.

It is management accounting responsibility to evaluate the intellectual property effectiveness. Management accounting report is an internal report for the manger to make a decision.so; it will not be available for the public.
the supportive non-physical infrastructure, processes and databases of the organization that enable human capital to function
consisting of such as customer relationships, supplier relationships, trademarks and trade names

People like to divide intellectual capital to three categories: human, structural and relation capital.
There is an argument regarding this classification and some academics are questioning the benefit from it.
Human capital is inherent in people and cannot be owned by an organization. Therefore, human capital can leave an organization when people leave, and management has failed to provide a setting where others can pick up their know-how

There are different interpretation and consideration of intellectual capital between Academic and practical.

There are no standards for its measurement. It can be viewed from financial perspective. Different people measure different things when it comes to intellectual capital.

It is the human capital. Involves measurement of how staff works correctly. How one achieves the strategy.

It defines what one should measure. Some measure the easier things living out the hard ones. Other factors are almost impossible to measure.
Measurement of assets is divided in to two. That is measuring intangible assets and measuring tangible assets.
Measurement of liabilities involves measurement of nonperforming employees as well as old processes that need replacement.

Stake holders find it to be an expense when implementing a new system. Historical cost is important as it is true and shows true and fair view. Employee turnover is measured through number of employees and it is done differently from one organization to another.

There is always a financial gap between true value of assets and the amount at which a company is valued.

Structural capital is what there is without human capital.

Measuring is only one thing. The aim is to achieve the same thing so it is not about managing or not managing.

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