Asset valuation, Linear Programming, Opportunity value

The earliest known commercial use of the English term was in 15711 although the idea which it conveys is probably much older. Yet when Francis More read a paper2 on goodwill3 to the Chartered Accountants' Students' Society of Edinburgh in 1891, he felt the need to preface his remarks on valuation with an apology. He regretted his inability to quote any authorities on the subject; he was unaware of any previous writings on goodwill valuation. The earlier writings on goodwill had concentrated on legal aspects, particularly the protection of attendant property rights. If anyone had considered the effect of different factors on price and how goodwill might be valued in the absence of the direct evidence of a market transaction, his opinion seems to have remained unpublished. Twenty-three years after the appearance of More's paper, P. D. Leake first published his views on the valuation of goodwill in a paper4 read to the Leicester Chartered Accountants' Students' Society. In the intervening period, however, the subject seems to have aroused considerable interest, and several writings included a discussion of it. Many factors contributed to this surge of interest. An increasing number of accountants were joining professional societies, many of which had been founded in the decade or so before 1891. There followed more organised oppor-

Reviews the book "Accounting for Goodwill," by George R. Catlett and Norman O. Olson.