Determinants Of Intellectual Capital Disclosure Research Articles

The Determinants of Intellectual Capital Disclosure on Firm Value: The Evidence on the Financial Companies in Indonesia

Objectives: Firm value is the price of the firm that can be sold with a price agreement that will be paid by the buyer. A high stock price will increase the value of the company and increase the prosperity of the investors. Therefore, to attract the attention of buyers of company shares, companies must provide the best and most detailed financial information possible. As for information that can be disclosed in financial reports, namely intellectual capital. The presence of PSAK No. 19 concerning intangible assets marked the beginning of the phenomenon of intellectual capital in Indonesia. It turns out that although Intellectual Capital Disclosure has started to grow in Indonesia, the growth is still very small. Companies in Indonesia should be required to disclose their intellectual property, particularly in the financial industry. This is because the financial services sector which is highly dependent on information uses more intellectual capital in its operations than the industrial sector which relies more on tangible assets. As it is known, the disclosure of intellectual capital can provide an attraction for investors to increase the value of the company. This study aims to find out how factors such as firm age, leverage, profitability, and independent commissioners affect firm value through the disclosure of intellectual capital.Methodology: This study uses a sample of financial sector companies listed on the Indonesia Stock Exchange in 2020-2021 with a total population of 105 companies and a total sample of 83 companies. This research uses panel data.Finding: According to the findings of this study, business size, profitability, age, independent commissioners, and disclosure of intellectual capital have a beneficial impact on firm value of about 43%. However, leverage does not affect firm value. Furthermore, the mediation test results show that disclosure of intellectual capital is not able to mediate the relationship between the effect of firm size, leverage, profitability, and firm age on firm value. Only the influence of independent commissioners mediates firm value.Conclusion: For future researchers, it is expected to increase the research period and add other factors that influence the disclosure of intellectual capital.

Intellectual Capital Disclosure: Determining Factors and Their Impact on Company Value

Disclosure of intellectual capital in Indonesia is still voluntary, it has been implicitly regulated in PSAK No. 19. This study will examine the determinants of intellectual capital disclosure and its consequences on firm value. The determining factors that are thought to influence the disclosure of intellectual capital in Indonesia are listing age, firm size and industry of type. The impact of intellectual capital disclosure is the value of the company. The research population is all companies that are included in LQ45 on the Indonesia Stock Exchange in the period 2015 to 2020. The number of research samples is 132 observations. The analysis used is multiple linear regression. The results of this study indicate that Listing age affects intellectual capital disclosure, Firm size affects intellectual capital disclosure, Industry of type does not affect intellectual capital disclosure and Intellectual capital disclosure affects firm value. The implication of these findings is that companies are starting to realize the importance of the role of intellectual capital in creating a company's sustainable competitive advantage. Intellectual capital is an important resource in the information and knowledge era for company growth that companies need to disclose to investors and potential investors.

Does Audit Committee Quality Mediate Determinants of Intellectual Capital Disclosure?

This study investigates the direct and indirect effects, mediated by audit committee quality, of managerial ownership, institutional ownership, and profitability on intellectual capital (IC) disclosure. The object observed of this study is companies listed on the Indonesia Stock Exchange (IDX) in the 2014-2018 period that are classified as high intellectual capital-intensive industries. Based on the sampling method, purposive sampling, 51 companies were selected as samples. This study used path analysis techniques with IBM SPSS version 25 to study the direct and indirect influences of managerial ownership, institutional ownership, and profitability toward IC disclosure. The results of this study show that managerial ownership, profitability and audit committee quality have a significant positive effect on IC disclosure whereas institutional ownership has significant negative effect on IC disclosure. This study also provides empirical evidence, supported by the sobel test, that the audit committee quality is able to mediate the effect of institutional ownership and profitability on IC disclosure. However, the audit committee quality is not able to mediate the effect of managerial ownership on IC disclosure. These findings develop and strengthen the results of prior studies related to the implementation of signaling theory and agency theory in devoting more understanding about IC disclosure.

Determinants of intellectual capital disclosure of financial institutions in an emerging economy

This study aims to examine determinants of intellectual capital disclosures of financial institutions in an emerging economy. The study constructs an intellectual capital disclosure index (ICDI) based on the disclosure of intellectual capital information in the annual reports of 53 listed financial institutions in Bangladesh. The study applies both parametric and non-parametric tests to examine the relationship of different company characteristics with ICDI. Results suggest that profitability and riskiness of firms are important determinants of intellectual capital disclosures. These findings support regulators and policy makers for deepening their understanding about the intellectual capital disclosure strategy of financial institutions. This study also contributes to the theoretical understanding of intellectual capital reporting by highlighting limitations of agency theory in explaining the relationship between different company characteristics and intellectual capital disclosure in the context of financial institutions of Bangladesh.

Determinants of Intellectual Capital Disclosure in Non-Vocational Higher Education in Indonesia

Research aims: This study aims to how intellectual capital (IC) disclosure has been carried out by Indonesian higher education institutions (HEI). In addition, this study examines the determinants of IC disclosure, namely age, size and accreditation status of HEI. Design/Methodology/Approach: The IC components used in this study refers to Ulum (2019), which modified the research from Leitner and Karl-Heinz (2002). This modification refers to the Study Program Accreditation Instrument (IAPS) 4.0 which has been regulated by the National Accreditation Board for Higher Education. The hypotheses test is conducted using SEM PLS. Research findings: The test results show that the age, size and accreditation status variables have a significant effect on intellectual capital disclosure (ICD). Theoretical contribution/ Originality: This study examines the IC disclosure with IAPS 4.0 that has just been applied in Indonesia. Practitioner/Policy implication: The study results provide an overview of the factors that drive IC disclosure in Indonesian HEI. Research limitation/Implication: This study only involved 86 large Indonesian non-vocational HEI.

Determinants of intellectual capital disclosure of financial institutions in an emerging economy

Determinants of intellectual capital disclosure of financial institutions in an emerging economy

ANALISIS FAKTOR-FAKTOR PENGUNGKAPAN INTELLECTUAL CAPITAL (PADA PERUSAHAAN FARMASI YANG TERDAFTAR DI BEI TAHUN 2011-2017)

The research of this thesis is entitled analysis of determinants of intellectual capital disclosure in Pharmaceutical Companies listed on the Indonesia Stock Exchange in 2011-2017. The purpose of this study was to determine the effect of the audit committee size, the independence of the audit committee, the number of financial experts in the audit committee, the number of audit committee meetings, the size of the board of commissioners, the independence of the board of commissioners, the number of board of commissioner meetings and institutional ownership of disclosure of pharmaceutical companies' intellectual capital. The research population is pharmaceutical companies listed on the Stock Exchange for the period 2011-2017. The research sample consisted of 11 pharmaceutical companies with 7 years of observation. Sample data are 77 financial report data. The research method uses quantitative methods. The research design consisted of descriptive design and causal design. Data analysis using Multiple Linear Regression Analysis using SPSS Version 20. statistical program. Based on the results of data processing, it is known that the Adjusted R Square value is 0.462. This shows that variations in the Intellectual Capital Disclosure variable can be explained by 46.2% by Audit Committee Size variables, Audit Committee Independence, Number of Audit Committee Financial Experts, Number of Audit Committee Meetings, Board of Commissioners Size, Board of Commissioners Independence, Number of Board of Commissioners Meetings , Institutional ownership and company size as control variables while the remainder is explained by other variables not examined. The results of testing the hypothesis, it is known that the size of the audit committee, the independence of the audit committee, the number of audit committee financial experts, the size of the board of commissioners and the independence of the board of commissioners have a positive effect on disclosure of intellectual capital Audit committee meetings have no effect on disclosure of intellectual capital.

New trends in intellectual capital reporting

PurposeThe purpose of this paper is to explore a new way to disclose intellectual capital (IC) in universities through their websites. Going beyond traditional tools used for intellectual capital disclosure (ICD), this study aims at identifying possible determinants of ICD via the web.Design/methodology/approachThis paper analyses the institutional websites of a sample of Italian universities adapting the theoretical framework developed by Low et al. (2015) to the peculiarities of the Italian university system. Moreover, the relationship between certain explanatory factors identified in previous research and the extent of online ICD represented by two disclosure indexes was tested through an ordinary least squares regression model.FindingsThe analysis reveals the extensive use of ICD via websites, especially regarding human and internal capital, while the disclosure of external capital through this means is still limited. Internationality and online visibility both positively affect the extent of a university’s ICD.Research limitations/implicationsThe paper represents the first study investigating online ICD and its determinants in universities, contributing new knowledge to help answer the how and what of the matter.Practical implicationsThe results can serve as encouragement to university managers to enhance online ICD to meet the information needs of a wider audience.Originality/valueThis is the first study to provide evidence about online ICD in universities and to reveal some of the possible determinants to improve this disclosure.

Determinants of intellectual capital disclosure in the IPOs and its impact on underpricing: evidence from Indonesia

Determinants of intellectual capital disclosure in the IPOs and its impact on underpricing: evidence from Indonesia

Determinants of intellectual capital disclosure: evidence from India

PurposeThis paper aims at exploring the extent and determinants of intellectual capital disclosure (ICD) in India.Design/methodology/approachContent of annual reports of 200 firms classified on their market capitalization is analysed using search terms to find out the extent and nature of disclosure. The period of study is 2010-11 and 2013-14. Paired t-test is used to see if there is any significant change in the level of disclosure between two time periods. The various determinants and their impacts are captured using a regression equation.FindingsThe analysis showed evidence that market capitalization, ownership and age of the firms are the major determinants of ICD in India. Performance, size and type of industry mattered only for large-cap firms. Disclosure levels are seen to increase with market capitalization. Human capital and external capital is highly reported by all categories of firms. The overall disclosure by all categories has significantly increased, whereas that of human capital and external capital has increased significantly only in small-cap and mid-cap firms.Originality/valueThis paper looks at size, market and performance-related variables and their impact on the extent of disclosure. It takes representative firms from three indices based on their market capitalization and evaluates them, thus making results and findings reliable. This is the first paper which takes a large cross section sample from across 12 sectors and also performs a longitudinal analysis. This paper is of interest to managers of firms who can affect the policies of their firms in making robust changes in disclosure practices.

Determinants of Intellectual Capital Disclosure in the IPOs and Its Impact on Underpricing: Evidence from Indonesia

We investigate the determinants of intellectual capital (IC) disclosure in the prospectus of initial public offering (IPO). Going deeper, we also examine the impact of IC disclosure on underpricing. By studying 86 IPOs of Indonesian firms over the period of 2000-2014, we do find that ownership retention and underwriting portion have a positive effect on the extent to which IC is disclosed. Moreover, our results reveal that IC disclosure is negatively correlated with the level of underpricing. In addition, evidence is also found that IC disclosure mediates the link between underwriting portion and underpricing.

Determinants of intellectual capital disclosure - Indian companies

Determinants of intellectual capital disclosure - Indian companies

Determinants of intellectual capital disclosure in initial public offerings: case of Canadian firms

The purpose of this paper is to investigate the determinants of intellectual capital information’s of firms that went through IPO.              Our sample includes 43 firms that IPOs listed in the Toronto Stock Exchange in 2012 of which the prospectuses for the initial public offering are available. Our study, unlike other studies focuses on the issuing prospectuses. The paper applied a disclosure index comprising of 78 items (Bukh and al (2005)) to quantify the amount of information regarding intellectual capital included in the IPO prospectuses of canadian firms. Multiple regression model and Correlation is used. The results revealed that the managerial ownership, the presence of an audit committee and industry are significantly associated with the voluntary disclosure of information about the intellectual capital in prospectuses. While firm size, age, the audit committee’ activity and audit quality do not affect disclosure. The results are interpreted in the light of the increasing importance of disclosing information on intellectual capital to the capital market a in case of IPO and constitute a contribution to the ongoing debate on corporate reporting practices.

The Determinants of Intellectual Capital Disclosure: Evidence from French stock exchange

The objective of this paper is to identify the determinants of voluntary intellectual capital disclosure (ICD) by analyzing a panel of French listed companies observed over the period 2006-2010. The results confirm that ownership structure, size, debts and the weight of activated goodwill are the determinants of voluntary ICD which allows managers to reduce agency conflicts and solve the inadequacy of financial reporting by disclosing relevant information (signals) for investors. However, our results disprove that voluntary ICD could be a process of legitimizing targeting other stakeholders.

Determinants of intellectual capital reporting

PurposeThe objective of this paper is to examine the determinants (i.e. firm size, profitability, leverage, type of audit firm and industry type) of intellectual capital (IC) disclosure in the annual reports of Malaysian listed companies.Design/methodology/approachThe data were collected from the 2006 annual reports of the selected listed companies; and analyzed using descriptive statistics, t‐test, correlation and regression analyses.FindingsThe paper found that firm size, profitability, industry type are determinants of IC disclosure (ICD) in the annual reports of Malaysian listed companies, while leverage and type of audit firm did not statistically influence ICD.Research limitations/implicationsThe paper only used data from the 2006 annual reports. However, the findings have highlighted the importance of ICD determinants based on data from an emerging economy (i.e. Malaysian economy).Practical implicationsThe paper provides empirical evidence on the current practices and determinants of ICD in the annual reports of the Malaysian listed companies. This evidence would help in understanding and determining factors that influence the extent of ICD. Subsequently, it could assist in enhancing ICD in the annual reports.Originality/valueThe paper contributes by extending the limited ICD literature in Malaysia. Furthermore, the paper has tested more determinants, deemed to influence ICD, compared to prior Malaysian studies. In addition, the paper used a larger sample size with a wider industry coverage compared to previous Malaysian literature.

Determinants of intellectual capital disclosure: evidence from Australia

PurposeThe purpose of this paper is to examine determinants of the decision to disclose intellectual capital in annual reports.Design/methodology/approachThe paper derives theoretical predictions from the previous literature and bases the study on archival data with a sample of 125 publicly listed Australian firms. The authors perform a content analysis of annual reports and complement the data with quantitative data from the sample firms.FindingsThe paper finds that industry type plays a key role as a determinant for the disclosure of intellectual property in annual reports. In addition, firm size is another determinant for intellectual disclosure of firms. In contrast with earlier studies and theoretical predictions of voluntary disclosure, however, the paper does not find any relationship between the level of information asymmetry and intellectual capital disclosure.Research limitations/implicationsOne limitation refers to the content analysis. Analyzing the annual reports based on the specified list of IC‐related terms may not provide the whole picture as well as the IC disclosure practices. Despite these limitations, the study helps to understand better in general what kind of firms actually disclose information on intellectual capital.Originality/valueIn contrast with earlier studies the study uses significantly more observations, which makes the results more reliable and generalizable. Of further significance is the finding that information asymmetry – one of the main problems between investors and firms – is not driving the decision of firms to disclose information on intellectual capital.

Determinants of intellectual capital disclosure in prospectuses of initial public offerings

Intellectual capital is recognised as the new economic era’s pivotal factor underlying value creation. Deficient and inconsistent intellectual capital reporting is escalating information asymmetry between informed and uninformed investors. This provides fertile ground for informed investors to extract higher abnormal returns andhigher wealth transfers from uninformed investors, particularly during a firm’s initial public offering (IPO). This study investigates the association between intellectual capital disclosure levels in prospectuses of 444 IPOs listing on the Singapore Stock Exchange between 1997 and 2006, and three potential explanatory determinants: (1) ownership retention; (2) proprietary costs; and (3) corporate governance structure. Statistical analysis supports our conjecture of a positive association between intellectual capital disclosure and ownership retention. We also find, consistent with expectations, a negative influence of proprietary costs on the positive intellectual capital disclosure – ownership retention association. However, contrary to predictions, we do not find an IPO’s corporate governance structure significantly influences the negative interaction of proprietary costs on the ownership retention – proprietary cost association. Our findings have implications for various parties such as regulators who may impose unnecessary costs on issuers if they introduce mandatory disclosures whilst lacking an understanding of the factors influencing intellectual capital disclosures.