VALUATION AND NEGOTIATION OF TECHNOLOGY

Presented By:
DANIEL PEÑA BARRIENTOS
CODE 1040322930

GROUP: 212032_24

INGENIERA
KARLA NATHALIA TRIANA
COURSE TUTOR

OPEN UNIVERSITY AND DISTANCE-UNAD

BASIC SCHOOL SCIENCE TECHNOLOGY AND ENGINEERING
INDUSTRIAL ENGINEERING PROGRAM
APRIL 24, 2018
Mention the four different valuation methods and explain them technology,
according to reading.
Four methods of approach found in reading are:
Cost approach methods: It estimates that the cost of re-creating the future utility of
the technology being valued, and takes this value to be the future performance of
technology. Technology assessment is done by calculating the cost of reproducing
the same technology acquisition or replacement cost of a similar asset acquisition,
and then reflecting the depreciation. The cost approach method is useful in the
evaluation of intangible assets such as software.

Market approach methods:estimates that the market price of similar technology

that has already been negotiated on the market and applies for evaluation. In
general, if there is already a comparative market where assets are actively marketed,
and whether information on transaction costs is readily available, it can become a
practical method. In this sense, although it is effective to evaluate real estate,
vehicles, computer software, general purpose, liquor license and franchises, is not
effective in assessing cases like most intangible assets or intellectual property, in
cases of similar transactions they are infrequent or details of transactions not
disclosed.

Input methods:considers the sum of the present values of future cash flows of technology as
the value of technology. This concept, regardless of the costs of technology development,
determines the value of technology in terms of their feasibility of expected profits. The input
method currently is divided into different branches according to its various facets surrounding the
assessment of expected future purposes. These facets include the estimated period of income
generation, estimating future revenues, risks of no benefit, and the conversion of future revenue
present value.

real options:Incorporates the financial concept of choices in technology

assessment, and as options are not considered as an obligation, but a right,
investors have the opportunity to correct their decision based on the future
environment using real options in decisions investment projects such as research
and development and technology transfer can ensure future flexibility against
uncertainty in decision-making. Heo said that real options is not simply a model that
expresses the value of a united to an alternative investment option, but that by itself
is a model of comprehensive evaluation of an alternative investment.

In the state of negotiations of intangible assets in the global part, there are
three examples of negotiations on intangible assets, please describe.
Examples
- When Procter and Gamble to buy Gillette in 63 billion dollars in 2005, intangible
assets were valued at 55 billion dollars, of which 35 billion corresponding to goodwill,
which represents 63.6% of the value intangible. Therefore, there was an
overestimation of trade intangibles funds and an underestimation of the identified
intangible assets.
- Walt Disney paid 7.5 billion dollars for the digital animation studio Pixar. Intangible
assets, trademarks and trade names were valued at $ 200 LLION Mi- while the
goodwill is valued at 5.6 billion dollars. This is another example of the overestimation
of goodwill and underestimation of the identified intangible assets.
- In 2006, Google bought YouTube for 1.2 billion dollars, which hit the headlines
brand values change. Beyond buying only 200 million were attributed to identified
intangible assets and 83.4% to goodwill. It is known that the success of YouTube is
due to the brand experience to attract users and cyber therefore, the assessment
made by the brand is extremely low.
How do you define the author goodwill?
Goodwill:Making it difficult to negotiation and results in undervaluation or
overvaluation and in turn, gain or loss of business.