Search results

We must acknowledge the importance of intangibles in today’s economies and the controversy over the accounting and reporting of these assets. For this reason, the purpose of this paper is to synthesize the lessons learned from research to date and identify gaps in that research that would be useful to academics and practitioners.

The literature review was conducted after an analysis of the most important academic databases in the period of 1990-2013: ABI Inform Complete, CSIS, EconLit, ISOC, Journal Citation Reports, Scopus, Emerald, Springer, and Google Scholar.

The authors offer a summary of the main gaps in the literature on intellectual capital disclosures, among which the authors perceive a need for increased qualitative or explanatory research, which would allow further analysis of such decisions.

Specifically, the main problem encountered in the research on voluntary disclosure of intangibles appears to relate to the type of methodology used, which is usually quantitative or descriptive.

Given that the principal limitations in the field of the disclosure of intangibles have been discussed, the authors conclude by indicating the principal directions for future research.

Qualitative analysis is absent in the literature the authors reviewed, and considered it fundamental to understanding this type of disclosure. In fact, the development of future lines of research could provide better-quality intangible asset reporting.

Although there are previous studies on this topic, the authors believe that the main contribution of this study is to offer an integrated framework of existing findings concerning decisions by companies to disclose information on intangibles, a topic on which previous literature is sparse.

The capitalisation of intangible investments is discussed controversially in the financial accounting literature. International accounting standards are concerned with this issue and generally demand more intellectual capital to be recognised on the face of the balance sheet. If investors and analysts already gather monetary information about intangible assets from the financial report and find such information useful, then the necessity to complement such information with voluntary intellectual capital disclosure will diminish. Accordingly, there should be an association between recognised intangible assets and voluntary intellectual capital disclosure. The paper aims to discuss these issues.

The authors analyse the voluntary disclosure of 264 investor conference and roadshow presentations of German DAX 30 firms in the year 2001, 2003, 2005, and 2007. The authors apply regression models to analyse the association between recognition of intangible assets and voluntary intellectual capital disclosure and control for other determinants of voluntary disclosure.

The authors find that the magnitude of recognised intangible assets is significantly and negatively associated with the quantity and quality of voluntary intellectual capital disclosure. The authors show that this association is mainly driven by goodwill accounting. In more detailed analyses we find different directions (positive, negative and insignificant) of this relationship for different categories of intellectual capital.

Future studies on voluntary intellectual capital disclosure need to consider recognised intangible assets as a determinant to avoid omitted variable problems.

The authors provide descriptive evidence about voluntary intellectual capital disclosure practice of Germany’s largest firms.

The paper provides primary evidence on the association between recognised intangible assets and voluntary intellectual capital disclosure.

The purpose of this paper is to investigate the incidence of International Financial Reporting Standard (IFRS) on stock market assessment of intangibles and voluntary disclosure about innovation.

The authors develop three regression models. The first model investigates the stock market valuation of intangible assets and disclosure about innovation. The second model desegregates earnings to assess the relevance of components related to intangibles. The third model investigates how intangible expenses and voluntary disclosure affect analysts forecast dispersion.

Results show that the value relevance of intangible assets and expenses improves with the adoption of IAS 38. Overall, results indicate a decrease in the value relevance of voluntary disclosure about innovation under IFRS. More specifically, results suggest some overlap in the information content of mandated and voluntary disclosure for stock market valuation of intangible assets under IFRS. Findings also suggest that voluntary disclosure moderates market's assessment of expensed intangibles under both Canadian GAAP and IFRS.

IAS 38 requires entities to recognize an intangible asset if certain criteria are met and to disclose specific information about it. In such a context, market participants may refer to a greater extent to financial reporting and to a lesser extent to voluntary disclosure when valuating intangibles.

Managers will have an incentive to better target their communications to ensure a degree of complementarity with financial reporting. In this sense, this study contributes to the voluntary disclosure literature.

To the best of the authors' knowledge, this is the first study to investigate the relationship between mandatory disclosure and voluntary disclosure about intangibles and evaluate the impact of IFRS on this matter.

The purpose of this chapter is to examine the reporting practices on intangible assets from the perspective of a post-transition economy. The chapter explores the significance of intangibles and the content of the disclosures provided by companies in annual reports.

The analysis is qualitative in nature. Annual reports of selected Slovene publicly traded companies are analysed. The research is based on the analysis of required disclosures by International Financial Reporting Standards (IFRS) and an analysis of voluntary disclosures provided by companies for the 2007–2011 financial years.

The results indicate that intangibles are less significant in comparison with publicly traded companies from traditionally developed economies. The analysis of disclosures reveals that companies provide almost exclusively the disclosures required by IFRS, while voluntary disclosures are not provided. Furthermore, results indicate deficiencies in financial reporting practices related to required disclosures.

The analysis is conducted on a small sample of companies. This is a consequence of the fact that a limited number of companies is trading on Ljubljana Stock Exchange. In the primary and standard quotation of shares, only 25 companies are present.

Since a growing stream of research emphasises the importance of intangibles for companies’ performance, the findings indicate possibilities for improvement of financial reporting.

The research findings contribute to existing research in the field of accounting for intangibles from the perspective of a post-transition economy. More studies of this kind in transition and post-transition economies using IFRS have yet to be performed.

This paper aims to investigate the possible corporate governance attributes that can influence companies in Ghana to disclose intangible assets in their annual reports to stakeholders.

A data set from 110 firms in Ghana for the year ending of 2016 was used. Each annual report was individually examined and coded to obtain the disclosure of intangible asset information index. Descriptive analysis was performed to provide the background statistics of the variables examined. This was followed by regression analysis, which forms the main data analysis method.

A large proportion of companies disclosed that the useful lives of intangible assets (either acquired or internally generated) are finite and also disclosed their useful lives or the amortisation rates used. Auditor type, industry type and leverage were the factors influencing the compliance with IAS 38 disclosure requirements.

This is the first study in Ghana that considered the impact of corporate governance factors on IAS 38 information disclosures. This study contributes to the literature on the relationship between corporate governance and disclosure by showing that the disclosure of intangible asset information in Ghana is associated with Auditor type, industry type and leverage.

In this paper, the authors analyze the use of content analysis in disclosing voluntarily information on intangible assets, the intangible assets disclosures (IAD). The purpose of this paper is to conduct a structured literature review (SLR) that assesses the possibilities and limitations of content analysis.

To that end, the authors analyze the existing literature on the topic in the main international databases. In all, 74 empirical articles utilizing content analysis as a research methodology for IAD were reviewed. Regarding the selection of sources, the authors should indicate that the SLR performed includes academic studies published in journals or presented at conferences and that are always subject to a double process of anonymous review.

The obtained results indicate that despite the frequent use of content analysis in studies on IAD, its use does not meet all expectations.

The study synthesizes the research on content analysis for the case of information on intangible assets, offering an updated and global framework for future researchers through the SLR.

Among other problems, the authors found its excessive emphasis on the amount disclosed in the annual report, ignoring other reports in which more information regarding intangible assets is available, such as in the case of the sustainability reports. Furthermore, the use of very different coding systems and its exclusive use without being combined with other methodologies are detected. These aspects affect the quality problems of the sources used, which directly results in the utility of the evidenced findings.

These conclusions allow the authors to conclude on the need to open different lines of study that review the use of content analysis in this topic.

The work focuses on the quality of disclosures more so than on the quantity, offering a critical view that summarizes the utility of the employment of content analysis for this type of disclosure and its implications for future research on this topic. Despite previous studies, the authors highlight the new insights revealed from IAD research, especially since the seminal paper of Dumay and Cai (2014).

The purpose of this paper is to investigate intangible disclosure quality (IDQ) in an international sample of 29 stock‐quoted telecommunications network operators (TNOs). IDQ is captured separately for annual reports and websites of TNOs using a set of seven intangible asset categories. The article also explores associations between annual report and website IDQ on the one hand and variables interpreted either as IDQ antecedents (e.g. firm size) or as IDQ performance consequences (e.g. market‐to‐book ratio) on the other.

TNOs' 2003 or 2003/2004 annual reports and TNOs' websites (as of May 2005) were subjected to content analytical procedures in order to quantify sample firms' disclosure quality levels for seven categories of intangible assets derived from a framework suggested by the Deutsche Schmalenbach Gesellschaft für Betriebswirtschaft eV.

Both annual report and website IDQ levels of TNOs were relatively low. Intangible disclosures were often limited to small pieces of qualitative information. Annual report and website IDQ are significantly positively interrelated. IDQ varies significantly by the home region of the TNO, with European TNOs displaying higher quality levels than their American counterparts. IDQ measures were not significantly related to TNOs' financial performance criteria.

Research limitations result from the study's single industry focus, small sample size and the limited range of variables investigated as potential IDQ antecedents/consequences.

TNOs get insights on IDQ within their industry. Regulators/standard setting accounting institutions are encouraged to encounter industry‐specific intangible characteristics by industry‐focused intangible measurement rules in addition to an overall intangible reporting framework.

This study is the first investigation that simultaneously analyzes IDQ both in a firm's annual report and on its website. Further, it is unique in its use of uni‐ and multivariate analytical techniques exploring IDQ antecedents/consequences and in its single industry/TNO focus.

The purpose of this paper is to investigate the relationship between voluntary disclosure of intangibles and financial analysts’ earnings forecasts properties.

Disclosures about intangible assets were hand-collected through content analysis of annual reports of a sample of US non-financial firms, while analysts’ earnings forecasts properties were collected from Bloomberg Professional database. The authors relied on correlation and multivariate regression analyses to test the research hypotheses.

The results show that increased intangible disclosures affect analysts’ earnings forecasts accuracy, dispersion, and favourable consensus recommendations. However, this effect varies according to the nature of intangible assets.

The results may be of interest to different market participants such as corporate managers, financial analysts, and standards setting bodies that recently published guidelines on voluntary disclosure of intangibles.

This study develops a new comprehensive index to measure the content of narrative disclosures about a large number of intangibles, such as human, structural, and relational assets. The findings contribute to the current debate on the value-relevance of narrative disclosures on intangibles to investors and financial analysts.

The purpose of this paper is to analyse the management teams' views regarding different aspects related to the disclosure of non‐financial information in the annual report. The focus is on the following aspects: incentive, quantity, focus, use of non‐financial key performance indicators (KPIs) and trends.

The data are based on a comprehensive questionnaire survey addressed to investor‐relation managers (IRMs) at the largest companies listed on the Stockholm Stock Exchange.

The study confirms an increasing focus of non‐financial information related to intangible assets in corporate disclosure. This increase appears to be both regulatory and demand driven. Encouraging indeed is that management teams seem to have acknowledged the importance not only to describe the less tangible values per se, but also to explain the roles they play in the value‐creation process and in corporate strategy. Furthermore, the study reveals a trend shift from research and development (R&D) and relational information towards corporate social responsibility (CSR) and employee‐related information, an increasing number of non‐financial KPIs and a positive attitude to mandatory requirements. Overall, the findings indicate that voluntary disclosure compensates for the deficiencies of financial statements to properly disclose intangible assets. This may lessen the risk of the argued impairment of the efficient allocation of resources on the stock market.

The findings reveal that quite a few challenges lie ahead in shaping efficient corporate disclosures where also intangible assets are in focus. The most critically relate to dealing with the concerns of reliability and comparability associated with disclosures of intangible assets and their related non‐financial KPIs. This needs to be taken on promptly by management teams, policy makers and financial market regulators if the corporate‐disclosure process shall function efficiently and facilitate decreased information asymmetry and uphold an efficient allocation of resources on the stock market.

Herein not only one aspect related to disclosure of non‐financial information is being analysed, but also several and from a management‐team perspective, which is a perspective often neglected for the sophisticated‐user perspective.

This research examines the likelihood that Panamanian and Colombian banks listed on their respective stock exchanges voluntarily disclose intangible liabilities based on such variables as their size, profitability, indebtedness, age and growth. The presented findings concur with agency theory, signalling theory and the owner-cost theory.

The authors propose a probabilistic model to test the influence of size, profitability, indebtedness, age and growth on the disclosure of intangible liabilities. The dependent variable, the disclosure index, was constructed from a dichotomous approach using Harvey and Lusch's (1999) model, which has 24 characteristics, plus six that we added in our research. These were grouped into four categories: procedures, human activity, information and organisational structure.

Banks in Panama and Colombia with a larger size, higher profitability, lower age and higher growth are more likely to disclose more information about their intangible liabilities. However, indebtedness does not serve as a determinant of the disclosure of these liabilities, even though its relationship is negative.

The limitation of the research was the voluntary disclosure of information about these liabilities on firms' websites.

The contributions of this research are as follows. First, we used an intangible asset disclosure methodology to verify the disclosure of intangible liabilities, in line with Harvey and Lusch's model, as well as providing another six indicators, thereby producing an extended model. Second, being the first empirical research to study the disclosure of intangible liabilities in Panama and Colombia opens a door to future research on this topic.

This research provides a significant practical contribution to society because banks listed on public stock markets, understanding that undisclosed intangible liabilities lead to opportunity costs in their profitability, might tend to disclose more information, thus promoting greater transparency in the market.

The main contribution of this research is applying an intangible asset disclosure methodology to the disclosure of intangible liabilities, following Harvey and Lusch's (1999) model, as well as the creation of an expanded model.