Abstract:
The development of digital platforms has increased the importance of
accounting. The digital platform does not have a physical substance, so it is difficult
to be recognized and valued its valuation. The traditional valuation method can not
work well for the digital platform. Therefore, this research attempts to determine
the proper accounting treatment for the digital platform based and appraises the
value of digital platform by proposing real option method as an alternative
approach. This research is using the qualitative method and the research data was
collected from Facebook financial reports. The result of this study shows that the
digital platform can be recorded as an intangible asset. Moreover, two valuation
models either the Black-Scholes model or the Binomial model can be used as a tool
for generating value of digital platforms. This research is limited to use the sample
of digital platform only from the social media industry.
