Stock Exchange: Intellectual Capital Disclosure and Profitability

Document Type : Original Article

Authors

1 Master of Science in Accounting, Azad University, International Centre of Kish, Kish, Iran

2 Department of accounting, Kish international branch, Islamic Azad University, Kish island, Iran

Abstract

Intellectual capital is a key element in improving a firm assets and employee in order to increase productivity as well as to sustain competitive advantage. Human capital is the combined capabilities, knowledge, skills, experience, innovativeness and problem – solving abilities of each individual’s knowledge. The study of the relationship between profitability and disclosure of intellectual capital components in the Companies listed on the Tehran Stock Exchange is evaluated. For the operationalization of disclosure of intellectual capital and its components, the checklist Li et al (2012) and Return on Assets ratio were used for profit. Results of 44 firms (189 firm-years) during the period 2011- 2013 indicates that at 91 percent, positive and significant relationship between profitability and disclosure of intellectual capital there. So that the, by increasing and improving profitability, companies have an incentive to voluntarily disclose information on intellectual capital. The other variables were observed, significant and positive relationship between firm size and disclosure of intellectual capital, human capital, customer capital there, growth opportunities and disclosure intellectual capital. A positive relationship was seen between financial leverage and disclosure customer capital there.

Keywords

References

Abeysekera, I., & Guthrie, J. (2005). An empirical investigation of annual reporting trends of intellectual capital in Sri Lanka. Critical Perspectives on accounting, 16(3), 151-163.
Basta, M., & Bertilsson, R. (2009). Innovation and internal reporting of Intellectual Capital-An empirical study. Unpublished thesis, Gothenburg University.
Berzkalne, I. (2013). Macroeconomic Factors as Determinants of Company Performance: Evidence from the Baltic Countries. Proceedings of 5th International Conference Economic Challenges in Enlarged Europe, Tallinn, Estonia, 16-18 June.
Bhasin, M. L. (2011). Intellectual capital reporting study of IT-sector corporations in India. Australian Journal of Business and Management Research, 1(1), 16-28.
Bontis, N., Chua Chong Keow, W., & Richardson, S. (2000). Intellectual capital and business performance in Malaysian industries. Journal of intellectual capital, 1(1), 85-100.
Bounfour, A., Edvinsson, L. (2005). IC For Communities, Nations, Regions, and Cities. Butterworth-Heinemann, Boston.
Chen Goh, P. (2005). Intellectual capital performance of commercial banks in Malaysia. Journal of intellectual capital, 6(3), 385-396.
Chen, J., Zhu, Z., & Yuan Xie, H. (2004). Measuring intellectual capital: a new model and empirical study. Journal of Intellectual capital, 5(1), 195-212.
Chen, M. C., Cheng, S. J., & Hwang, Y. (2005). An empirical investigation of the relationship between intellectual capital and firms' market value and financial performance. Journal of intellectual capital, 6(2), 159-176.
Davis, J. L., & Harrison, S. S. (2002). Edison in the boardroom: How leading companies realize value from their intellectual assets (Vol. 28). John Wiley & Sons.
European Commission. High Level Expert Group on RICARDIS., & European Commission. Directorate General for Research. (2006). Reporting intellectual capital to augment research, development and innovation in SMEs: report to the Commission on the High Level Expert Group on RICARDIS: encourage corporate measuring and reporting on research and other forms of intellectual capital (Vol. 22095). Office for Official Publications of the European Communities.
Firer, S., & Mitchell Williams, S. (2003). Intellectual capital and traditional measures of corporate performance. Journal of intellectual capital, 4(3), 348-360.
Ho, C. A., & Williams, S. M. (2003). International comparative analysis of the association between board structure and the efficiency of value added by a firm from its physical capital and intellectual capital resources. The International Journal of Accounting, 38(4), 465-491.
Ismail, T. H. (2009). Intellectual capital reporting in knowledge economy: Evidence from Egypt. In International Conference on" Economic Directions III: Economic Policy in a Rapidly Changing World", the College of Business Administration, Kuwait University, Kuwait, December 2008.
 Madhoshi, M., & Nejad Amiri, A. (2009). Evaluation of Intellectual Capital and Investigation of its Relation with Financial Efficiency of Companies. Journal of Accounting Investigations, 16(57), 101-116 [In Persian].
Mageza, P. Z. (2008). Intellectual capital as a creator of wealth and shareholder value for an organization. Unpublished dissertation, Rand Afrikaans University.
Marr, B., Bukh, P. N., & Mouritsen, J. (2003). Perceived wisdom. Financial Management, 32-34.
Mavridis, D. G. (2004). The intellectual capital performance of the Japanese banking sector. Journal of Intellectual Capital, 5(1), 92-115.
Mouritsen, J., Larsen, H. T., & Bukh, P. N. (2001). Valuing the future: intellectual capital supplements at Skandia. Accounting, Auditing & Accountability Journal, 14(4), 399-422.
Nikolaj Bukh, P. (2003). The relevance of intellectual capital disclosure: a paradox?. Accounting, Auditing & Accountability Journal, 16(1), 49-56.
Ordóñez de Pablos, P. (2003). Intellectual capital reporting in Spain: a comparative view. Journal of intellectual capital, 4(1), 61-81.
Lynn, B. E. (1998). Performance evaluation in the new economy: bringing the measurement and evaluation of intellectual capital into the management planning and control system. International Journal of Technology Management, 16(1-3), 162-176.
Riahi-Belkaoui, A.(2003). Intellectual capital and firm performance of US multinational firms: a study of the resource-based and stakeholder views. Journal of Intellectual capital, 4(2), 215-226.
Rizvi, Y. (2011). Human capital development role of Human Resource (HR) during mergers and acquisitions. African Journal of Business Management, 5(2), 261-268.
Roos, G., Roos, G., Pike, S., & Fernstrom, L. (2007). Managing intellectual capital in practice. Routledge.
Kamath, B. (2008). Intellectual capital disclosure in India: content analysis of “TecK” firms. Journal of Human Resource Costing & Accounting, 12(3), 213-224.
Mohammadi, M. (2009). Effects of working capital management on companies’ profitability of listed companies on Tehran stock exchange. Journal of management, 14, 80-91.
Saghafi, A., & Aghaei, M. A. (1994). Behavior of Accounting Profit, Studying Accounting and Au­diting, 9, 5-21 [In Persian].
Salehi, M., & Mohammadi, R. (2014). The Effect of Intellectual Capital on the Profitability Ratios in the Banking Industry: Evidence from Iran. IUP Journal of Bank Management, 13(1), 38-52.
Schultz, T. W. (1993). The economic importance of human capital in modernization. Education Economics, 1(1), 13-19.
Shiu, H. J. (2006). The application of the value added intellectual coefficient to measure corporate performance: evidence from technological firms. International Journal of Management, 23(2), 356-362.
Stewart, T. A. (1997). Intellectual capital: The new wealth of nations. New York.
Sveiby, K. E. (2001). Methods for measuring intangible assets. Retrieved in August 18 2015 from http://www.sveiby.com/articles/IntangibleMethods.htm
Wong, M., & Gardner, C. (2005, July). Intellectual capital disclosure: New Zealand evidence. In Accounting and Finance Association of Australia and New Zealand (AFAANZ) Conference, Melbourne, Australia, July.
International Journal of Education and Applied Sciences
Volume 1, Issue 7 - Serial Number 7
December 2014
Pages 343-349

Files

Share

How to cite

Statistics