What you measure is what you manage

“What you measure is what you manage” says one of the most famous performance truisms. Taking it into consideration organizations implement more and more sophisticated methods of measuring and managing of their performance. Among years that systems has evaluated becoming much more detailed providing standardised set of information to their recipients

Nowadays we live in “new economy”, economy that basis its value on knowledge, information, brands, know-how, licence and other intangible assets that despite that do not have its physical form sometimes presents a significant or even fundamental part of company value. Some companies also polish one, build its value mostly on intangibles rather than on typical physical resources.

This new economic order challenges and offers innovative opportunities to the audit professionals and financial analysts and to the top managers. It became obvious that traditional methodology that was created to measure tangible assets may not be such efficient or even may appear irrelevant to measure intangible. In particular, the so-called intellectual capital supplements starts to be more popular part of annual reports of companies those assets are mostly intangible. This data pose a real problem of verification and scope of information which are disclosed to institutional investors and the general public. The procedures for verification and assessment of this new information are immature and need to be standardized and agreed at an international level.