With a recently issued ISO global standard for brand evaluation calling for a better understanding of brands, MASB has added a section on the impact of tax rate changes on brand value to its previously released white paper, Applying the Brand Investment & Valuation Model.
This guided tour through the model covers the steps taken to calculate an appropriate present value and how to apply the model to both short- and long-term marketing strategy. It incorporates a behavioral measure of brand strength in the hearts and minds of customers – brand preference – and establishes mathematical linkages from customer brand strength to brand monetary value. This framework provides Finance and Marketing teams a practical approach for monitoring the value of their commercial brands.
Since it’s fundamentally a discounted cash flow model, significant inputs such as discount and income tax rates come into play. They might be impacted by forces largely outside the control of the enterprise, but MASB believes that because they impact the present value of future cash flows, they must impact brand valuation.
According to MASB, “the implications of these impacts should prompt significant thought by enterprises (the owners of brands), shareholders (the investors in brands), financial institutions (the lenders to brands), and policy makers alike.”
Applying the MASB Brand Investment & Valuation Model is available free for download with registration.