Non-additivity in accounting valuation: Internally generated goodwill as an aggregation of interacting assets
In this paper we propose a new method to explain the creation and measure the value of internally generated goodwill (IGG). Our method is based on the idea that firm value is affected by interactions between assets used in combination to conduct business. This novel approach contrasts with the traditional additive approaches to valuing IGG, which assume assets are independent. We use Choquet capacities, i.e., non-additive aggregation operators, to explain the creation of IGG, and demonstrate from a sample of U.S. high technology sector firms that this model performs better than the traditional additive Ohlson model on accuracy in forecast enterprise value.
|Date of creation:||20 Apr 2011|
|Date of revision:|
|Publication status:||Published in European Accounting Association (EAA) 2011 annual meteing, Apr 2011, Rome-Siena, Italy. Financial reporting session, 2011|
|Note:||View the original document on HAL open archive server: https://halshs.archives-ouvertes.fr/halshs-00541525v3|
|Contact details of provider:|| Web page: https://hal.archives-ouvertes.fr/|
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