Accountants and finance professionals must understand Intellectual Property (IP) issues to help their business clients, says ACCA and the Intellectual Property Office (IPO) in a new guide produced jointly by the two organisations.
Called “Intellectual Property and the Practising Accountant”, the report is a guide for accountants and finance professionals to help them get to grips with the nuances of IP, from trade marks to patents. It also includes a quiz at the end of the report, so readers can test their understanding of the issues.
The report says that for most businesses, intangible assets represent well over half of corporate value. Yet according to IPO research, over 96% SMEs have never tried to assess what their IP is worth.
John Davies, head of business law at ACCA (accaglobal.com), says: “Businesses survive by being good at what they do, and doing those things in original ways. But success inevitably leads to imitation, and at some point most small firms will need to take steps to safeguard their intellectual property. As accountants are the most frequently used source of business advice for small firms, they are uniquely placed to help their clients protect and exploit their intangible assets.”
Robin Webb, Innovation Director at the Intellectual Property Office says: “Intellectual property is often a hidden or under exploited asset, as many companies struggle to identify, manage and protect it. I believe that accountants who have a basic familiarity with IP will advantage both themselves and their clients by reading this report.”
For firms, factoring IP into their business plan means understanding complex issues. For example, are UK trademarks valid in Europe? If a website is designed by a contractor, who owns the copyright? Neither is there any hard and fast way of quantifying IP; should it be the set-up cost of intangible assets, their market value, or their future worth which is costed?
“SMEs will likely have all sorts of questions,” concludes IPO’s Robin Webb.
“To gauge the full value of their IP and protect it accordingly, it is critical that their most trusted advisers are well-equipped to answer these queries.”
The report can be downloaded from ACCA’s website.