How important is IP to the balance sheet? A CFO’s perspective
For four years, Frank Luo has held the role of chief financial officer at Lazada Group in Singapore, an international e-commerce company owned by Alibaba that is now celebrating its tenth year as a pioneer in the region.
Responsible for overseeing a wide range of internal and external finance-related matters for the company, including protecting its vital assets, and providing financial leadership to grow the business, he’s well-positioned to offer insight into the challenges of IP valuation.
“Lazada Group, like most digital and technology companies, predominantly derives its value from intangible assets (IA),” says Luo.
Examples of Lazada’s IA include IP (trademarks, patents, and copyright) data, software, patents and know-how, strong customer relationships, goodwill, brands, a skilled workforce, and organisational designs and processes, he adds.
“The management of such IA squarely fits within my responsibilities and is deeply entrenched in Lazada’s overall value and success,” Luo explains.
This is not a responsibility that Luo takes lightly.
To keep abreast of these responsibilities, the “ever-changing landscape of tax, financial, and regulatory reporting requirements that impose differing, and sometimes ambiguous, standards” for valuing IA and IP must be considered, he says.
