84% & The Death of Today’s: Accounting, Security Analysis & Asset Manager Compensation in Personal Financial Planning Clothing

84%  & The Death of Today’s: Accounting,

 Security Analysis & Asset Manager Compensation

 in Personal Financial Planning Clothing

According to investment group Ocean Tomo, 84% of the S&P 500’s market value is comprised of intangible assets.

 Patents, trade secrets and brand reputation are the lifeblood of many modern business.

Best’s Review, ‘Insuring Intangible Risks,’  p47, April 2018

(note: A.M. Best Company provides news, credit ratings and financial data products and services for the insurance industry since 1899)

Given the above:

·         What is the value & usefulness of corporate balance sheets prepared by accountants?

·         As for securities analysis – Johnny Carson being reincarnated as Carnac the Magnificent – would be more reliable in predictions (especially given security analysts rely heavily on the corporate income, balance sheets, and cash flow statements provided by Accountants in Wonderland (with or without Alice but certainly the Mad Hatter.)

·         How can personal financial planners, compensated as a percentage of assets under management like asset managers, play asset manager selecting stocks, bonds, mutual funds, etfs’ etc? What added value do these asset under management compensated personal financial planners provide?

·         How can actuaries – the same one’s responsible for long term care policy screw ups even after the travesty of crash value life insurance premiums blowing up and companies going under in the early 90’s – insure these risks – without a firm calculation of values?

As a recovering fee only personal financial planner who practiced the concept of Enough in contrast to the More of moreon planners, personal financial planning is about managing goals not managing assets. Planners – especially asset under management compensated asset managers in financial planning clothing – manage assets often to an orphan secondary status even to the detriment of other personal financial planning goals (recall Maslow: if all you know is a hammer, everything looks like a nail ---((or assets under management??))). Now given the Tomo Study unless disputed and the compression of asset under management percentages due to robo advisors, planners will have to – need to – go back to personal financial planning – managing goals.

PS: Isn't it interesting this study has not been exposed to date in The Wall Street Journal, and accounting journals - given the monumental impact on accounting, securities analysis, risk management. One can only wonder why - as inquiring minds want to know.