The governance of intangibles: Rethinking financial reporting and the board of directors

Yuri Biondi and Antoine Reberioux

Accounting forum, 2012, vol. 36, issue 4, 279-293

Abstract: This paper develops a theoretical analysis of performance measurement systems (including related accounting standards) and the composition of the Board in the context of business models driven by complementarities, innovation and intangibles. Performance management systems frame and shape the representation of business performance and risk, while the composition of the Board is designed to control and govern the business processes and disclosure of information over time. Complementarities, intangibles and innovation exacerbate the information asymmetry that characterizes the specific economy of the business firm, making it different from external markets. Therefore, firm-specific information becomes as important as market prices to gauge the past and future performance and risk of the ongoing business firm. Specific knowledge of the firm is therefore required to disclose relevant and reliable information and to monitor corporate executives. This argues for the role of improved historical cost accounting systems coupled with non-independent, proficient Board members.

Keywords: Intangibles; Board composition; Financial regulation; Accounting regulation; International accounting standards; Corporate governance; Fraud; Enron; Lehman Brothers; Grey directors; Board independence; Board quality; Accounting quality; Accounting for intangibles (search for similar items in EconPapers)
JEL-codes: D80 G30 M41 (search for similar items in EconPapers)
Date: 2012
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

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Related works:
Working Paper: The Governance of Intangibles: rethinking financial reporting and the Board of Directors (2009)
Working Paper: The governance of intangibles: Rethinking financial reporting and the Board of directors (2008)
Working Paper: The governance of intangibles: Rethinking financial reporting and the Board of directors (2008)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:accfor:v:36:y:2012:i:4:p:279-293

DOI: 10.1016/j.accfor.2012.03.003

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