Intellectual capital versus the book value of assets: a value-relevance comparison based on productivity measures.
November 19, 2013 Editor 0
Purpose – This study provides new evidence, made possible by human capital data that became available after IFRS adoption, on the productivity of intellectual capital and its components. These productivity measures are modelled to determine their value-relevance in the share market, and the modelling is extended to comparative productivity measures for the book value of assets.Design/methodology/approach – Financial data is sourced from financial databases and company annual reports on a sample of 160 Australian listed firms over a five year period. Panel regression analysis is used to test five models built from Riahi-Belkaoui’s (1999) general price model of the value-relevance of accounting numbers.Findings – The results show that the productivity of human capital, structural capital and intellectual capital are each significantly positively related to share price (i.e., have value-relevance), whereas the productivity of total assets at book-value is non-significant and tangible assets is inversely significant.Originality/value – This study constructs a new improved method of computing the amount of structural capital, and uses recently available financial statement data to provide first-time evidence on human capital and its inclusion in the determination of the amount of intellectual capital. These new models and data enable a direct comparison to be made between the value-relevance of intellectual and the book-value of assets.
Go to Source
- Africa: Satellite Technologies for Africa – a User Perspective
- Africa: The Case for Boosting Africa’s Knowledge Ecosystem
- Understanding the Role of Value-Focused Thinking in Idea Management
- For success and sustainability, seek broad social ‘well-being’; Good governance promotes a ‘virtuous cycle’ of growth
- WHO cone bio-assays of classical and new-generation long-lasting insecticidal nets call for innovative insecticides targeting the knock-down resistance mechanism in Benin.
- Please RSVP Now for ICT4D Principle 9: Be Collaborative
Categories: Interlectual Capital
Subscribe to our stories
- Entrepreneurial Alertness, Innovation Modes, And Business Models in Small- And Medium-Sized Enterprises December 30, 2021
- The Strategic Role of Design in Driving Digital Innovation June 10, 2021
- Correction to: Hybrid mosquitoes? Evidence from rural Tanzania on how local communities conceptualize and respond to modified mosquitoes as a tool for malaria control June 10, 2021
- BRIEF FOCUS: Optimal spacing for groundnuts in smallholder farming systems June 9, 2021
- COVID-19 pandemic: impacts on the achievements of Sustainable Development Goals in Africa June 9, 2021