IG ACCOUNTING CONTINUED FROM PAGE 5
professionals, if organizations are to reflect
insights, possibly leading to new product and
their true value. IG Accounting continued on
service innovations.
page 10 Like cost accounting, there will be
Having a solid IG program in place would
multiple ways to approach Information
seem to be the foundation for developing
Accounting.
approaches to a new field which should be
called, Information Accounting.
Doug Laney of Gartner writes that
Microsoft's recent $26 billion purchase of
This may be further along than most think. In
LinkedIn was "all about the data" in that all
2013, the Compliance, Governance and
the assets including buildings, hardware,
Oversight Council (CGOC) published the,
software, and even Lynda.com training
"Information Economics Process
libraries (purchased in 2015) all come down
Assessment Kit."
to one bottom line, the value of the data
LinkedIn collects on its users. He goes on to
Economics is not so far off from Accounting.
And the CGOC report is all about what most
write:
of think of as IG. It discusses the declining
"According to Gartner research, companies
in the information product business have a 4
-5x higher market-to-book value than the
average company. (Actually the ratio is
what’s called a Tobin’s q). And thankfully for
info product companies, information isn’t
considered a balance sheet asset per
value of information over time, stating,
"To make way for new and more useful
information, ensure businesses get value
from data, control IT and legal costs, and
lower risk and exposure, companies should
dispose of unnecessary data debris."
antiquated accounting regulations (GAAP),
so they don’t have to report it."
"In short, investors looooooove information
product companies. They also love
companies that leverage information to the
hilt. Information savvy companies, according
to our research, warrant a 2-3x higher q
value than average."
Good
Information Governance (IG) requires that
organizations value information as an asset.
To do they
must take steps to
inventory their information holdings, classify
and appraise them, and dial in the proper
level of security and control for sensitive
information. Once they are able to focus on
the high value information, they can do the
"fun stuff" using analytic tools to gain new
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