Purpose - Several theories have arisen and several conceptual frameworks have been developed around knowledge as the new driver in the value creation process. It has been translated and applied for the most diverse assignments: under an economic theory context, it has emerged as knowledge assets, as intellectual capital for the most management theories and as intangible assets for the normative accounting approaches. The aggregation and exploitation of their multiple modules has settled the appearance of multiple approaches that put intangibles as the most important key driver towards the strategic and financial level achievements. Its dynamic transformation process is the genesis of a solid, consistent and sustainable competitive advantage. Our key aim in this research is to identify the intangibles recognized by the Portuguese Airlines companies, their impact in the companies’ strategies and their inclusion in the internal management reporting systems. Design/methodology/approach – Our research is based on the Portuguese Civil Aviation Sector, specifically in the air transportation activity. Using an exploratory analysis, we have identified the rule of intangibles in that activity and the approaches that support their recognition and measurement. The research has evolved all 21 Portuguese Airlines companies and the Portuguese Civil Aviation Regulator. Several structured inquiries were conducted in the companies’ financial departments and in the National Activity Regulator. Non-parametric tests were performed in order to identify possible clusters and dependence linkages between companies’ features and intangible policies and procedures. Originality/value –This methodology clarifies the stage of knowledge management implementation and intangible assets measurement and recognition in the companies’ reporting systems. Several intangible were identified, some of them supporting strong and sustainable competitive advantages. This research also constitutes a deep sector diagnosis, the first step for an organizational culture change as regards of intangibles reporting requirements. Practical implications – The capitalization of intangibles assumes, in the air transportation activity, a residual nature. This evidence corroborates the results achieved in other studies. Intangibles are usually expensed in the period and directly integrated in the accounting based results. We have shown that companies have followed a cost based approach in their valuation but for the capitalized intangibles, an income approach was followed for their useful lives establishment. This procedure is based on their evidence of future benefits and returns. The findings identified in this research claim for a complementary intangible assets scorecard report. Statistical approaches have shown that no dependence exists between the results of inquiries and the airlines company’s characteristics. Results also show that the objectives and detractors identified have a transversal and structural nature, and are not focussed in a discrete company type or cluster. The results concerning the intangibles recognition and measurement revealed that we are still at the borderline of the intangibles integration in a standard reporting system. However, the sweeping changes occurred and the volatile nature of the air transportation activity claims for a conceptual model consolidation.

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