ABSTRACT
The growing significance of intangible assets has rendered Generally Accepted Accounting Principles (GAAP) insufficient for the financial community. GAAP needs to be supplemented by a set of Generally Accepted Intangible Principles, or GAIP. GAIP should begin at a very general level, and a body, comparable to the Financial Accounting Standards Board (FASB) in the US, should use these principles to guide the development of standards that govern the way publicly-traded company's measure and report on their intangible assets. The transition from a product-based to a service- and knowledge-based economy means that many of organizations crucial resources are not measured and reported under GAAP. GAAP has moved slightly in the non-cost direction by measuring the present value of several liabilities, and reporting some assets at lower of cost or market value, but it nevertheless remains a system that reports on a firm's historical performance rather than its potential.
