Value-relevance of expensed and capitalized intangibles - a French survey
AbstractSignificant difference exists between the market value and book value of firms. It could be attributed to the fact that intangible assets are not reflected in the financial statements. Our resuls indicate a statistical association between the "capitalized goodwill" and the market-to-book ratio, but do not indicate any statistical link with the "expensed intangible-intensity" nor the "capitalized intangible-intensity". These results support and contradict, for a part, the explanation on the loss of value relevance of financioal information, which could be due to the non-recognized intangibles in financial statements. However, the differing French and American accounting treatments of intangible expenditures may explain why these expenses are not taken into account by french capital markets when estimating the value of companies.
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Bibliographic InfoPaper provided by ESSEC Research Center, ESSEC Business School in its series ESSEC Working Papers with number DR 03022.
Length: 45 pages
Date of creation: Jul 2003
Date of revision:
Intangible intensity; Market-to-Book ratio; Value-relevance; Goodwill; Capital markets; Ohlson model;
Find related papers by JEL classification:
- G12 - Financial Economics - - General Financial Markets - - - Asset Pricing; Trading Volume; Bond Interest Rates
- M41 - Business Administration and Business Economics; Marketing; Accounting - - Accounting - - - Accounting
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