1、October 2011 Translation by DIN-Sprachendienst.English price group 10No part of this translation may be reproduced without prior permission ofDIN Deutsches Institut fr Normung e. V., Berlin. Beuth Verlag GmbH, 10772 Berlin, Germany,has the exclusive right of sale for German Standards (DIN-Normen).IC
2、S 03.140!$tte“1818166www.din.deDDIN ISO 10668Brand valuation Requirements for monetary brand valuation (ISO 10668:2010)English translation of DIN ISO 10668:2011-10Markenbewertung Anforderungen an die monetre Markenbewertung (ISO 10668:2010)Englische bersetzung von DIN ISO 10668:2011-10Evaluation dun
3、e marque Exigences pour lvaluation montaire dune marque (ISO 10668:2010)Traduction anglaise de DIN ISO 10668:2011-10www.beuth.deDocument comprises pagesIn case of doubt, the German-language original shall be considered authoritative.1509.11 DIN ISO 10668:2011-10 A comma is used as the decimal marker
4、. Contents Page National foreword .3 Introduction .41 Scope 5 2 Terms and definitions5 3 General requirements6 3.1 Transparency .6 3.2 Validity 6 3.3 Reliability 6 3.4 Sufficiency6 3.5 Objectivity.6 3.6 Financial, behavioural and legal parameters 6 4 Specific requirements .7 4.1 Declaration of purpo
5、se7 4.2 Value concept.7 4.3 Identification of brand .7 5 Valuation approaches and methods 7 5.1 General considerations.7 5.2 Income approach .8 5.3 Market approach 10 5.4 Cost approach11 6 Necessary valuation inputs 11 6.1 Market and financial data11 6.2 Behavioural aspects11 6.3 Legal aspects .13 6
6、.4 Sourcing and use of quality data and assumptions.14 7 Reporting 14 8 Independence.15 2 DIN ISO 10668:2011-10 National foreword This standard has been prepared by Technical Committee ISO/TC 231 “Project Committee: Brand Valuation” (Secretariat: DIN, Germany). The responsible German body involved i
7、n its preparation was the Normenausschuss Dienstleistungen (Services Standards Committee), Working Committee NA 159-01-03 AA Markenwertmessung. 3 Introduction Intangible assets are recognized as highly valued properties. Arguably the most valuable but least understood intangible assets are brands. H
8、owever, reliable values need to be placed on brands. This International Standard provides a consistent, reliable approach to brand valuation, including financial, behavioural and legal aspects. Brand valuation Requirements for monetary brand valuation 4 DIN ISO 10668:2011-10 1 Scope This Internation
9、al Standard specifies requirements for procedures and methods of monetary brand value measurement. This International Standard specifies a framework for brand valuation, including objectives, bases of valuation, approaches to valuation, methods of valuation and sourcing of quality data and assumptio
10、ns. It also specifies methods for reporting the results of such valuation. 2 Terms and definitions For the purposes of this document, the following terms and definitions apply. 2.1 asset legal right or organizational resource which is controllable by an entity and has the capacity to generate econom
11、ic benefits 2.2 brand marketing-related intangible asset including, but not limited to, names, terms, signs, symbols, logos and designs, or a combination of these, intended to identify goods, services or entities, or a combination of these, creating distinctive images and associations in the minds o
12、f stakeholders, thereby generating economic benefits/values 2.3 intangible asset identifiable non-financial asset with no physical substance 2.4 monetary brand value brand value economic value of the brand in transferable monetary units NOTE The result obtained can be either a single economic value
13、or a range of values. 2.5 premise of value assumption regarding the most likely set of circumstances that can be applicable to the subject valuation 2.6 present value current discounted worth of a future monetary amount 2.7 stakeholder person whose decision making is, or might be, affected by a bran
14、d NOTE Common stakeholders are customers, consumers, suppliers, employees, potential employees, opinion leaders, shareholders, investors, governmental authorities and non-governmental organizations. 5 DIN ISO 10668:2011-10 2.8 trade mark legally protectable sign, or any combination of signs, capable
15、 of distinguishing the goods or services of one undertaking from those of other undertakings EXAMPLE Words (including personal names), letters, numerals, figurative elements and combinations of colours. NOTE 1 This definition is in accordance with the trade mark definition of the WTO Agreement on Tr
16、ade-Related Aspects of Intellectual Property Rights (TRIPS). NOTE 2 A trade name is the name of a business, association or other organization used to identify it. It might or might not be the same as the trade mark used to identify the companys goods and/or services. 2.9 valuation date date on which
17、 the valuation is concluded 2.10 value date date on which the valuation inputs, assumptions and valuation result are valid 3 General requirements 3.1 Transparency Monetary brand valuation processes shall be transparent. This requirement includes disclosure and quantification of valuation inputs, ass
18、umptions and risks as well as, when appropriate, sensitivity analyses of the brand value to the main parameters used in the valuation models. 3.2 Validity A valuation shall be based on valid and relevant inputs and assumptions as of the value date. 3.3 Reliability If a valuation is repeated, it shal
19、l reliably give a comparable and reconcilable result. 3.4 Sufficiency Brand valuations shall be based on sufficient data and analysis to form a reliable conclusion. 3.5 Objectivity The appraiser shall conduct the valuation free from any form of biased judgement. 3.6 Financial, behavioural and legal
20、parameters When performing a monetary brand valuation, financial, behavioural and legal parameters shall be taken into account, the aforementioned parameters forming part of the overall assessment. The monetary brand valuation shall be conducted on the basis of the findings from the financial, behav
21、ioural and legal modules. 6 DIN ISO 10668:2011-10 4 Specific requirements 4.1 Declaration of purpose The declaration of purpose shall specify the intended use, the addressed audiences, the identified asset, the premise of value, the position of the appraiser (valuator), the valuation date and the va
22、lue date. The value concept shall be specified in accordance with the purpose of valuation. NOTE The purposes of valuation are diverse. Common purposes are: a) management information; b) strategic planning; c) value reporting; d) accounting; e) liquidation; f) legal transaction; g) licensing; h) lit
23、igation support; i) dispute resolution; j) taxation planning and compliance; k) loan and equity financing. 4.2 Value concept The monetary value of a brand shall represent the economic benefit conferred by a brand over its expected useful economic life. Generally, the monetary value shall be calculat
24、ed by reference to cash flows, determined by reference to earnings, economic profits or cost savings. 4.3 Identification of brand The appraisal shall identify, define and describe the brand subject to valuation. 5 Valuation approaches and methods 5.1 General considerations Brands shall be valued by
25、applying the income, market or cost approach. The purpose of the valuation, the value concept and the characteristics of the brand being valued shall dictate which approach (or approaches) is (are) utilized to calculate the value of a brand. 7 DIN ISO 10668:2011-10 5.2 Income approach 5.2.1 Descript
26、ion of the income approach The income approach measures the value of the brand by reference to the present value of the economic benefits expected to be received over the remaining useful economic life of the brand. The steps followed in applying the income approach shall include estimating the expe
27、cted after-tax cash flow streams attributable to the asset over its remaining useful economic life, and converting these after-tax cash flow streams to present value through discounting with an appropriate discount rate. 5.2.2 Determination of cash flows 5.2.2.1 General The cash flows (or an alterna
28、tive measure of brand earnings) used in a brand valuation shall be those cash flows reasonably attributable to the brand. Various methods are available to determine the cash flows, as outlined in 5.2.2.2 to 5.2.2.7. 5.2.2.2 Price premium methodN1)The price premium method shall estimate the value of
29、a brand by reference to the price premium that it generates. The price charged for goods or services marketed with a certain brand shall preferably be compared with the price charged for a generic product, i.e. an unbranded product. In order to arrive at the additional cash flow attributable to a br
30、and, the appraisal shall identify and eliminate non-brand factors that make it possible for the owner of the brand to charge a higher price for the goods or services in question. Additional and extra costs incurred in order to be able to charge a premium price shall be deducted from any price premiu
31、m charged. In many industries, identifying an unbranded or generic product for comparison with a branded product can be difficult, and price premium shall then be assessed through reference to the brand with the lowest brand strength (see 6.2.4) in the market. The price premium method shall be used
32、taking into account the volume premium method. In addition, it shall take into account cost-saving benefits. 5.2.2.3 Volume premium methodN2)The volume premium method shall estimate the value of a brand by reference to the volume premium that it generates. In order to determine the cash flow generat
33、ed by the brand, the volume premium method can be applied. In this method, additional cash flows generated through a volume premium shall be determined based on an analysis of market shares. The additional cash flow generated by the brand is the operating cash profit related to the excess market sha
34、re. The appraisal shall pay attention to the fact that there may be other factors explaining a specific market share. Market imperfection is one such very important factor. When valuing a brand with a significant market position, N1) National footnote: The “price premium method” is a specific form o
35、f the “incremental cash flow method”. N2) National footnote: The “volume premium method” is a specific form of the “incremental cash flow method”. 8 DIN ISO 10668:2011-10 the appraisal shall identify the effect of any market imperfection on the generated cash flow and exclude this from the cash flow
36、 attributed to the brand. As with the premium price, consideration shall be given to additional costs incurred in order to hold a larger market share or faster growth in market share. The volume premium method shall be used taking into account the price premium method. In addition, it shall take int
37、o account cost-saving benefits. 5.2.2.4 Income-split method The income-split method shall value the brand as the present value of the portion of the economic profit attributable to the brand. The economic profit corresponds to the net operating profit after a charge for capital employed in the busin
38、ess, expressed at market value. The results of behavioural research shall then be used to identify the contribution of the brand to increasing earnings or reducing costs. The value of the brand shall then correspond to the present value of the portion of the economic profit over the brands remaining
39、 useful economic life. 5.2.2.5 Multi-period excess earnings method The multi-period excess earnings method shall value the brand as the present value of the future residual cash flow after deducting returns for all other assets required to operate the business. When there are several intangible asse
40、ts generating cash flow in the business, this method requires a valuation of each individual group of intangible assets in order to be able to calculate the cost of capital related to each of them. 5.2.2.6 Incremental cash flow method The incremental cash flow method shall identify the cash flow gen
41、erated by a brand in a business through comparison with a comparable business with no such brand. In practice, there are few situations where one can identify such similar conditions of operations, without one specific asset the brand.N3)Cash flows are not only generated through increased revenues,
42、but also through reduced costs. Such cost efficiencies shall be identified and considered when valuing a brand. 5.2.2.7 Royalty relief method In order to determine the cash flow generated by the brand, the royalty relief method can be applied. This method shall measure the value of the brand as the
43、present value of expected future royalty payments, assuming that the brand is not owned but licensed. The value calculated through the royalty relief method thus constitutes the present value of the royalty payments saved through the ownership of the brand. The royalty rate applied in the valuation
44、shall be determined after an in-depth analysis of available data from licensing arrangements for comparable brands and an appropriate split of brand earnings between licensor and licensee, and shall be as close as possible to brands with the same characteristics and size as the brand subject to valu
45、ation. 5.2.3 Determination of financial variables 5.2.3.1 Determination of discount rate Under the income approach, risks that are not already reflected in future cash flows shall be considered in the discount rate. The discount rate used for discounting future expected cash flows attributable to a
46、brand shall be derived from the discount rate used for the discounting of cash flows generated by the business as a whole, i.e. the N3) National footnote: Therefore, in practice, the specific forms of the “incremental cash flow method” are normally used. 9 DIN ISO 10668:2011-10 weighted average cost
47、 of capital (WACC). As a business is a portfolio of assets and liabilities, the discount rate shall also reflect the specific risks of the brand. Unless explicitly considered in the cash flow projection or in the estimated lifetime of the asset, some entity-specific factors shall be considered in th
48、e discount rate including, but not limited to, market, behavioural and legal risks. 5.2.3.2 Useful economic life The useful economic life of a brand, using the income approach, shall consider the general trend for brands in the industry in which the brand is used. The valuation shall not cover a for
49、ecast period that exceeds the remaining useful economic life of the brand. NOTE It is possible for a brand to have an indefinite useful economic life. 5.2.3.3 Tax considerations 5.2.3.3.1 Tax rate Cash flows in the income approach shall be calculated on the after-tax basis. 5.2.3.3.2 Tax amortization benefit (TAB) When valuing a brand, the effect of tax savings through depreciation (amortization) shall be considered and, where relevant, calculated. The valuation reports shall clearly state if the value includes the value of any tax savings and, where relevant, show this valu
