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The governance of intangibles: Rethinking financial reporting and the board of directors

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  • Yuri Biondi
  • Antoine Rebérioux

Abstract

This paper develops a theoretical analysis of performance measurement systems (including related accounting standards) and the composition of the Board in the context of business models driven by complementarities, innovation and intangibles. Performance management systems frame and shape the representation of business performance and risk, while the composition of the Board is designed to control and govern the business processes and disclosure of information over time. Complementarities, intangibles and innovation exacerbate the information asymmetry that characterizes the specific economy of the business firm, making it different from external markets. Therefore, firm-specific information becomes as important as market prices to gauge the past and future performance and risk of the ongoing business firm. Specific knowledge of the firm is therefore required to disclose relevant and reliable information and to monitor corporate executives. This argues for the role of improved historical cost accounting systems coupled with non-independent, proficient Board members.

Suggested Citation

  • Yuri Biondi & Antoine Rebérioux, 2012. "The governance of intangibles: Rethinking financial reporting and the board of directors," Accounting Forum, Taylor & Francis Journals, vol. 36(4), pages 279-293, December.
    • Handle: RePEc:taf:accfor:v:36:y:2012:i:4:p:279-293
    DOI: 10.1016/j.accfor.2012.03.003
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    Cited by:

    1. Sandro Montresor & Antonio Vezzani, 2016. "Intangible investments and innovation propensity: Evidence from the Innobarometer 2013," Industry and Innovation, Taylor & Francis Journals, vol. 23(4), pages 331-352, May.
    2. Tsunogaya Noriyuki & Okada Hiromasa & Patel Chris, 2011. "The Case for Economic and Accounting Dualism: Towards Reconciling the Japanese Accounting System with the Global Trend of Fair Value Accounting," Accounting, Economics, and Law: A Convivium, De Gruyter, vol. 1(2), pages 1-56, October.
    3. Y. Biondi & P. Giannoccolo & A. Reberioux, 2009. "Efficient monitoring and control in intangibles-driven economies: is full independence always required?," Working Papers 664, Dipartimento Scienze Economiche, Universita' di Bologna.
    4. Baker C. Richard & Yuri Biondi & Qiusheng Zhang, 2009. "Résistance Et Confusion Dans L'Harmonization Des Normes Comptables Internationales : L'Approche Chinoise Aux Fusions Et Acquistions," Post-Print halshs-00458944, HAL.
    5. Sandro Montresor & Antonio Vezzani, 2022. "Financial constraints to investing in intangibles: Do innovative and non-innovative firms differ?," The Journal of Technology Transfer, Springer, vol. 47(1), pages 1-32, February.
    6. Richard Barker & Alan Teixeira, 2018. "Gaps in the IFRS Conceptual Framework," Accounting in Europe, Taylor & Francis Journals, vol. 15(2), pages 153-166, May.
    7. Biondi Yuri, 2015. "An Economic Analysis of ‘Comply or Explain Principle’ under a Review Panel Regime," Accounting, Economics, and Law: A Convivium, De Gruyter, vol. 5(3), pages 295-300, November.

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    More about this item

    JEL classification:

    • G30 - Financial Economics - - Corporate Finance and Governance - - - General
    • M41 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Accounting
    • D80 - Microeconomics - - Information, Knowledge, and Uncertainty - - - General

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