The International Accounting Standards Board needs to address the whole area of accounting for intangibles, says new chair Andreas Barckow.
In his inaugural speech at the World Standard-setters virtual conference Barckow said that the IFRS standard on intangibles, IAS 38, is more than 20 years old and has never been revisited, other than for consequential changes resulting from other projects.
He stressed that everyone recognised the significance of intangibles, especially self-generated intangibles, which have increased substantially over the last two decades.
Barckow explained: “Today many, if not most, companies around the globe operate in the service sector. They attract a lot of attention in the capital markets and, in fact, some of the richest market valuations. However, we don’t capture well the basis of their value creation or consumption. This is the key reason why, personally, I would like us to explore what we can do to increase transparency in this area.”
