This paper provides a survey of recent developments in the reporting of intangible assets. It finds that rather than the wholesale restructuring of the accounting model that was proposed years ago, the trend has been to address gaps in reporting with new forms of reporting. New forms of reporting appear better suited to capture the type of information that users of intangibles data seek.

Financial reporting standards continue to change both at the national and the international level with the result that they are better able to capture some types of intangibles data. Even so, some areas such as human capital remain difficult to reflect in traditional financial statements. Users interested in human capital information are much better served by reports that are tailored to their needs, and by reporting techniques that take into account the specificities of human capital.

On the policy front, companies are receiving considerable encouragement to provide more information on the intangible drivers of corporate performance than ever before. In Europe, part of the impetus has been the Accounts Modernisation Directive, which requires an “enhanced director’s report” that can include a discussion of human capital to the extent that directors feel that it is important for a full understanding of the business and its performance.

There appears to be a trend to report beyond the limits of what traditional accounting standards require, and include a broader set of important value drivers. The question has moved from whether this information is important and whether it needs to be reported, to how to best report it. A number of standard setters now provide guidance on how to better report on important performance drivers, including intangibles and human capital. Much of this new reporting is expected to appear in management’s discussion and analysis (MD&A) or its equivalent, and is expected to be subject to boardlevel review.

Future developments can be expected in a number of areas including the further enhancement of reporting techniques, development and agreement upon a conceptual framework for intangibles reporting, and eventually the development of reporting taxonomies for XBRL (Extensible Business Reporting Language), which should allow for easier, more uniform, and cost-efficient reporting.