Read the case regarding capital intelligence below and answer the following questions. Australia is leading a global push to tighten companies reporting procedures by introducing standards to apply hard numbers to intangible assets such as intellectual capital. An industry working group appointed by the Australian Government Information Management Office is readying a set of standards to define and measure human assets and so called knowledge capital on corporate balance sheet. The Australian Government Consultative Committee on Human Capital has been working on the issue for two years and will submit the standards to the organization for Economic Co-operation and Development Committee chairman Peter Fritz, who is the group managing director of local technology firm TCG, said most organizations had more than 60 percent of assets tied up in knowledge capital, which under current accounting rules, are neither represented nor valued on company balance sheets. Most of the IT industry, where 70-80 percent of the stock market valuation of an organization was based on intangible assets outside the hardcore, like fixed and cash assets. * If people are our greatest assets, we need to start measuring it more seriously.. said Mr Vamos, the chief of Microsoft Australia. (Source: Excerpts from Australian, 26 November 2004, p.26.) Required: a) Define asset as per stated in Malaysian accounting conceptual framework. (3 marks) b) Explain whether intellectual capital meets the definition and recognition of assets as per stated by the framework. (7 marks) c) Intellectual capital should not be recognized in Statement of Financial Position." Required: Outline any FIVE(5) possible reasons on that (5 marks) Read the case regarding capital intelligence below and answer the following questions. Australia is leading a global push to tighten companies reporting procedures by introducing standards to apply hard numbers to intangible assets such as intellectual capital. An industry working group appointed by the Australian Government Information Management Office is readying a set of standards to define and measure human assets and so called knowledge capital on corporate balance sheet. The Australian Government Consultative Committee on Human Capital has been working on the issue for two years and will submit the standards to the organization for Economic Co-operation and Development Committee chairman Peter Fritz, who is the group managing director of local technology firm TCG, said most organizations had more than 60 percent of assets tied up in knowledge capital, which under current accounting rules, are neither represented nor valued on company balance sheets. Most of the IT industry, where 70-80 percent of the stock market valuation of an organization was based on intangible assets outside the hardcore, like fixed and cash assets. * If people are our greatest assets, we need to start measuring it more seriously.. said Mr Vamos, the chief of Microsoft Australia. (Source: Excerpts from Australian, 26 November 2004, p.26.) Required: a) Define asset as per stated in Malaysian accounting conceptual framework. (3 marks) b) Explain whether intellectual capital meets the definition and recognition of assets as per stated by the framework. (7 marks) c) Intellectual capital should not be recognized in Statement of Financial Position." Required: Outline any FIVE(5) possible reasons on that
