Are Messi and Neymar tangible assets?

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How do you classify an asset?

'The law requires circa 40 pages of figures in the annual company report but these figures represent only 3% of the company’s value and assets. The remaining 97% are the company's intangible assets'. 
Source: Microsoft

We have heard the same refrain from our CEOs many times by now: “You, the people, are our most valuable asset…”. But have we ever seen ourselves in a firm’s Balance Sheet under Assets? No!

Historically, corporate success has been built on physical assets and improving manufacturing efficiency. In the new economy (think of Google, Facebook, biotechnology companies etc.) modern companies use ideas and market positions. The most important assets for many businesses are now brands, market positioning, knowledge capital and…… people!

But such intangible assets are rarely recognized. Why? 

Here are three questions that have to be answered during asset valuation – see how difficult answering is when the asset in question is a person:

These three questions must be answered in the affirmative if an item is to be classified as an asset with value that is to be reported in the company’s or football club’s balance sheet.

What do you think? Let us know in the Comments below!

Find out how to value intangible assets like footballers' talent in Part Two.


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