Eventually, it may be said that there are more disadvantages of entering self-generated immaterial assets into the financial statements than advantages. Even though there are arguments, which support the fact that self-generated intangible assets would be better to be included in the financial recordings, they can not outweigh the disadvantages of entering them into balance sheets of an entity. The most convincing arguments for the entering intangible assets, which were self-created by a company to it’s financial statements is the fact that not including such immaterial assets as highly-skilled labor (intellectual capital) may lead to a negative consequences. For instance, investor may undervalue the real value of a firm when deciding whether to spend his money in it or not. On the other hand, among the most convincing arguments against recognizing intangibles are, as mentioned above, problems with assessing the real value of intellectual and other capital and the fact that recordering intangible assets, such as highly skilled labor, etc. will not influence the success of company’s financial reporting. Finally, According to Skinner, 2008 it is hard to identify how accounting rules and standards could be adjusted in a way they allow self-generated intangible assets to be recognized and recorded assets without adapting the overall accounting model in relevant
Eventually, it may be said that there are more disadvantages of entering self-generated immaterial assets into the financial statements than advantages. Even though there are arguments, which support the fact that self-generated intangible assets would be better to be included in the financial recordings, they can not outweigh the disadvantages of entering them into balance sheets of an entity. The most convincing arguments for the entering intangible assets, which were self-created by a company to it’s financial statements is the fact that not including such immaterial assets as highly-skilled labor (intellectual capital) may lead to a negative consequences. For instance, investor may undervalue the real value of a firm when deciding whether to spend his money in it or not. On the other hand, among the most convincing arguments against recognizing intangibles are, as mentioned above, problems with assessing the real value of intellectual and other capital and the fact that recordering intangible assets, such as highly skilled labor, etc. will not influence the success of company’s financial reporting. Finally, According to Skinner, 2008 it is hard to identify how accounting rules and standards could be adjusted in a way they allow self-generated intangible assets to be recognized and recorded assets without adapting the overall accounting model in relevant