Can the purchase price allocation process be used to bring order to the spiraling “value” of IP?

The message that intangible assets are at the center of value creation in today’s economy is now getting to company CFOs, and they are being asked to do a better job in managing those intangible assets.

David Rosenbaum in CFO.com asks, “What should CFOs do to value their companies’ intellectual property accurately and diligently?” Unfortunately, the article is short on answers, but one strategy that will hopefully gain some traction impacts valuation analysts significantly.

In order to better price deals, Anne Culotta, a patent attorney at Culotta Law Firm, urges finance and IP-management groups to turn the purchase price allocation process on its head and value the intangible assets in a to-be-acquired company BEFORE the acquisition, even before the letter-of-intent stage.