The advancing to a knowledge based economy cannot happen without affecting the accounting system. All the papers published worldwide are a proof of the growing importance of intangible assets at both European and international level. This phenomenon has determined researchers to look for ways to value, recognize and account for them. The fact that there is no unique world-widely accepted response to the valuation and recognition of the intellectual capital, challenged us to the present literature review. The aim of this paper is to discuss various opinions regarding the possibility of recognizing intellectual capital in the financial statements and the extent to which there is a need to recognize it. We conclude that, the traditional accounting system needs to be extended to capture the company’s value creation potential and to be based on the effectiveness of its response to the stakeholder’s expectations as well.