Valuation assignments must estimate the value of intangibles, recognising the volatility, ongoing creation, and problems with protection and enforcement. Business valuation analysts have been independently valuing intangible assets for many years, usually in the context of an exchange between owners (transaction), for estate and gift tax purposes, or as part of a litigation assignment. Knowledge underlies the creation of value. Some of the questions that need to be answered include the following:
What would a willing buyer pay to employ the intangible asset?
What is the useful life of this asset?
What portion of the operating income does this asset generate?