The valuation of intangible assets encompasses the financial quantification of identifiable non-physical assets that generate economic value for a company — brands, trademarks, customer relationships, technology and software, patents, licences, know-how and workforce. It is required in three main contexts: Purchase Price Allocation following an acquisition, impairment testing (IAS 36), and contentious or regulatory proceedings (divorce, shareholder disputes, tax assessments).

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The three standard methods for intangible asset valuation are: the relief-from-royalty method (for brands and technology — capitalises the notional royalty saved by owning rather than licensing the asset), the multi-period excess earnings method — MPEEM (for customer relationships — isolates the cash flows attributable to the customer base net of contributory asset charges), and the with-and-without method (measures the value increment attributable to the intangible by comparing cash flows with and without it).

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In the Franco-Swiss context, intangible asset valuations are required for cross-border transfers (transfer pricing documentation under OECD guidelines), restructuring operations (contribution of intangibles to a Swiss IP holding), and Purchase Price Allocations under IFRS 3. The AFC requires arm's length valuations for intangible transfers between related parties.

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Example: a Franco-Swiss food group acquires a Swiss brand for CHF 12.0M total consideration. The PPA values the brand at CHF 4.5M (relief-from-royalty method, 3.5% royalty rate, 15-year DCF), customer relationships at CHF 2.8M (MPEEM, 8-year attrition model) and technology at CHF 1.2M. Total identifiable intangibles: CHF 8.5M; residual goodwill: CHF 3.5M.

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At Hectelion, we specialise in the valuation of intangible assets for M&A transactions, tax restructurings and disputes — applying internationally recognised methodologies to Franco-Swiss contexts.