What is the competitive nature of the market (i.e. perfect competition, monopolistic or oligopolistic competition, fragmented markets)?
To begin our example, let’s assume that there are two potential exit markets for the customer related intangible asset being measured including the customer list broker market and the mergers and acquisitions (M&A) market. Each of these markets has defining characteristics such as level of activity, groups of market participants, and differing levels of competitiveness. While a reporting entity may be able to obtain some pricing information from both markets, significant adjustments may be required to determine an estimated selling pricing for the specific customer related intangible asset being measured. Question #2: What is the highest and best use for the asset? To answer this question, a reporting entity should identify all of the potential uses of the asset within each potential exit market and determine if the value of the asset would be maximized by using the asset on a stand-alone basis (that is, an in-exchange valuation premise) or in conjunction with other assets (that is, an
Related Questions
- What is the competitive nature of the market (i.e. perfect competition, monopolistic or oligopolistic competition, fragmented markets)?
- How does a monopolistic competition market structure monolopy as opposed to a perfect competition market structure?
- Does a monopoly, oligopoly, perfect competition, or monopolistic competition have the most market power?
