MEASUREMENT OF INTELLECTUAL CAPITAL

Intellectual capital (IC)includes intangible assets that are the real source of the creation of value in a company. Intellectual Property includes assets which help it in adapting to fast change environment and the ability to create future value creation either through in-house research or through the purchase of new technology from outside. The measurement of IC has become very relevant and more and more statutory bodies are recognizing the needs of standardizing the accounts standards and include IC in balance sheet. Valuation of IC is very essential to truly determine the value of an enterprise. If the company brings out its own value of IC, then it will be subjected to creative accounting. Standardization of the complete framework of IC will take time and sustained efforts and hopefully accounting standards will inculcate IC values in balance sheets. But yes, before that the journey of valuation of IC will continue.