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The purpose of this paper is to examine a range of metrics concerning knowledge and related intangible assets in financial service industries. The metrics are then analyzed according to theory from several disciplines so as to better understand intangible dynamics, the relationship between different intangibles. Guidance is provided in terms of valuing knowledge and pursuing competitive intelligence (CI) based on the unique characteristics of financial services intangibles.

Data are drawn from a large database and supplemented with other sources. The primary database includes a considerable collection of publicly available financial results combined with proprietary data from a CI consultancy. Results on knowledge asset-levels and CI activity, by industry sector, are presented as well as the degree to which big data is employed.

Financial services show high levels of big data, low levels of knowledge assets, and high levels of CI activity. In some ways, these differing valuations of intangibles by different parties are counterintuitive, but they can be explained with reference to theory and a deeper understanding of the intangible dynamics.

The results allow a deeper understanding of the relationship between data, information, knowledge (explicit and tacit), and intelligence in a specific industry. Given the uniqueness of the financial services results, these findings provide considerable insight into how intangibles strategies and applications can differ by industry.

These results provide direction to financial services decision-makers concerning investment in knowledge management systems (limited), CI initiatives (aggressive), and big data (aggressive).

The paper brings unique data to the table and brings together theory from a number of disparate fields of study, providing a different perspective on the interplay of knowledge, intelligence, and data in financial services.

Apparel exports by OECD countries and imports of developing countries, the counter‐flow of international trade in apparel, were examined. Application of a gravity model indicated that proximity was important in determining the marketing destinations of apparel exports of OECD countries. There was a large variation in apparel imports to the developing countries from the developed countries, and while generally increasing, there were also large fluctuations over time. The trade flow was explained by differentiation of products and inequality of income in the developing countries. Regression analysis was used to determine the factors which influenced apparel imports of developing countries from OECD countries. The result indicated that income level was the most important determinant, and that apparel imports were income elastic. Market conditions, and remarkably, market barrier, had no significant impact.

The purpose of this chapter is to review the accumulated research on a strategically important intangible asset – organizational reputation – and articulate promising research pathways forward. To do so, I first provide definitional clarity by comparing reputation to the related constructs of status, celebrity, legitimacy, and social approval and highlight the codifiable, cumulative, and beneficial nature of reputation. I then discuss three developments in reputation literature: (1) conceptualizing reputation as a multidimensional, rather than generalized, construct; (2) theorizing about reputational malleability rather than its path dependence; and (3) focusing on the costs of a high reputation in addition to its benefits. Based on these developments and the increasing role of social media in affecting and reflecting stakeholder perceptions, I discuss three pathways for future reputation research. Specifically, I focus on the decrease in credibility of powerful intermediaries and increase in stakeholder empowerment, conceptualization of reputation as a flow rather than a stock, and the role of strategic reticence. My hope is that this chapter will stimulate conceptual and empirical work on the role of reputation in the complex and dynamic era of social media.

This study aims to investigate how the intangible intensive nature of firms affects the value relevance of earnings and the book value of equity between profit- and loss-reporting firms. The study also examines how firms’ intangible intensity affects the value relevance of R&D outlays between profit- and loss-reporting firms.

An empirical analysis based on Ohlson’s (1995) framework is used. A total of 54,421 firm-year observations of Indian listed firms from financial years 1992–2016 constitute the study sample.

The findings suggest that the difference in the value relevance of earnings and the book value of equity between profit- and loss-reporting firms is more significant in non-intangible intensive firms than in intangible firms. Specifically, earnings are more value relevant in profit-reporting and non-intangible intensive firms, whereas book value of equity is more value relevant in loss-reporting and intangible intensive firms. The results also suggest that the difference in the incremental value relevance of R&D information between profit- and loss-making firms is higher in intangible intensive firms than in non-intangible intensive firms.

The findings of this study can help managers, standard-setters and investors make effective decisions.

This study offers insights into the impact of intangible intensity on the value relevance of aggregated and disaggregated accounting information between profit- and loss-making firms in institutional settings where capitalization of R&D expenditures is allowed.

The purpose of this paper is to study the information content of intangible assets under IAS/IFRS when compared to local GAAP for European listed companies.

The paper employs multivariate regression models for a sample of 1,855 European listed firms in a six‐year period, from 2002 to 2004 in local GAAP and from 2005 to 2007 in IAS/IFRS to investigate the empirical relationships between market value of European firms and book value of their intangible assets.

The results suggest that the book value of other intangible assets of European listed firms is higher under IFRS than local GAAP and has more informative value for explaining the price of the share and stock market returns. European investors, however, consider the financial information conveyed by capitalized goodwill to be less relevant under IFRS than with local GAAP. Thus, identified intangible assets capitalized on European company balance sheets provide more value‐relevant information for shareholders than unidentified intangible assets that have been transferred into goodwill, with the exception of Italian and Finnish investors.

The paper adds to the existing literature on IFRS by documenting the association between the market value of European listed firms and the book value of their goodwill and other intangibles assets. The study complements prior studies by demonstrating that country differences persist despite the use of common accounting standards and that legal and regulatory country characteristics as well as market forces could still have a significant impact on the value relevance of accounting data.

The purpose of this paper is to investigate whether International Financial Reporting Standards (IFRS)-based data improve bankruptcy prediction over Australian Generally Accepted Accounting Principles (AGAAP)-based data. In doing so, this paper focuses on intangibles because conservative accounting rules for intangibles under IFRS required managers to write off substantial amounts of intangibles previously capitalized and revalued upwards under AGAAP. The focus on intangibles is also motivated by empirical evidence that financially distressed firms are more likely to voluntarily capitalize and make upward revaluations of intangibles compared with healthy firms.

This paper analyses a sample of 46 bankrupt firms and 46 non-bankrupt (healthy) firms using a matched-pair design over the period 1991 to 2004. The authors match control firms on fiscal year, size (total assets), Global Industry Classification Standard-based industry membership and principal activities. Using Altman’s (1968) model, this paper compares the bankruptcy prediction results between bankrupt and non-bankrupt firms for up to five years before bankruptcy. In the tests, the authors use financial statements as reported under AGAAP and two IFRS-based data sets. The IFRS-based datasets are created by considering the adjustments on the AGAAP data required to implement the requirements of IAS 38, IFRS 3 and IAS 36.

This paper finds that, under IFRS, Altman’s (1968) model consistently predicts bankruptcy for bankrupt firms more accurately than under AGAAP for all of the five years prior to bankruptcy. This greater prediction accuracy emanates from smaller values of the inputs to Altman’s model due to conservative accounting rules for intangibles under IFRS. However, this greater accuracy in bankruptcy prediction comes with larger Type II errors for healthy firms. Overall, the results provide evidence that the switch from AGAAP to IFRS improves the quality of information contained in the financial statements for predicting bankruptcy.

Small sample size and having data available over the required period may limit generalizability of findings.

Although bankruptcy prediction is one of the primary uses of accounting information, the burgeoning literature on the benefits of IFRS adoption has so far neglected the role of IFRS data in bankruptcy prediction. Thus, this paper documents a new benefit of IFRS adoption. In this paper, the authors demonstrate how the restrictions on the ability to capitalize and revalue intangibles enhance the quality of information used to predict bankruptcy. These results provide evidence to international standard setters of what they can expect if their efforts to remove non-restrictive accounting practices for intangibles are abandoned.

We build on the resource-based view and extend entry mode research by focusing on firms’ intention to transfer different resources from the parent firm to its overseas subsidiary. In line with our hypotheses, we find that parent firms that plan to transfer high levels of intangible resources to their foreign subsidiaries tend to choose wholly owned subsidiaries, while firms that intend to transfer high levels of tangible resources tend to choose international joint ventures. Moreover, we find that these relationships are moderated by institutional distance. We test our hypotheses using unique primary data from a sample of 128 foreign subsidiaries in the People’s Republic of China. Our results have important theoretical implications for international business strategy research as they develop further existing entry-mode theories.

The purpose of this paper is primarily to explore the extent of intangible assets and liabilities of large Malaysian companies. The authors also examine whether intangible assets and liabilities of a firm have similar or contrasting roles in firm performance.

Using a direct and straightforward measure of intangible assets and liabilities, the authors examine a large pool of data from large Malaysian companies over a six-year period spanning from 2008 to 2013.

The longitudinal analyses show a significant number of the sample companies, between 34 and 59.33 percent, have a consistent pattern of intangible liabilities. The authors also find firms with intangible liabilities have significantly underperformed financially than a control group of firms. In addition, the authors find that intangible liabilities have significant negative impact on firm performance whereas intangible assets have a contrasting positive impact on firm performance.

One limitation of this study is that the authors have only used a single measure of intangible assets and liabilities. Albeit the measures used are straightforward and more objective, there could be other measures to capture intangibles.

The research findings have several theoretical as well as policy implications. Theoretically, the authors extend the resource-based view to the intangible asset-liability mix, affirming the crucial role of intangible resources in financial performance whilst introducing the unfavorable role of intangible liabilities in corporate financial performance. In terms of policy implications, the research findings provide initial empirical input to emerging calls for broader perspectives of intangibles, beyond intangible assets to include intangible liabilities, and therefore belong to an emerging paradigm toward the nature of intangibles.

This study documents a rare empirical account of the contrasting roles of intangible assets and liabilities in corporate financial performance.

The debate about whether any difference exists between manufacturing and service operations is discussed. There is no difference per se between the two types of operation and that debate about differences between them is spurious. There are significant differences between operating systems which process materials and those which deal directly with customers. These differences are sufficient to require different treatment for material processing operations and customer processing operations. The similarities and differences between the two types of system are demonstrated, and strategies for managing customer processing operations are outlined. If an appropriate strategy is adopted, customer processing operations are very similar to material processing operations, but other strategies exist which make customer processing operations very different from material processing operations.

IAS 1 (“Presentation of financial statements”) requires that application of all international standards is necessary in order to comply officially with International Accounting Standards. This appears to be a key statement for the move towards accounting harmonization. The feasibility of this kind of harmonization could be jeopardized if even one standard is “rejected” by companies. In this context, in the wake of the publication of IAS 38 “Intangible assets”, examines the ways that 21 national and two international accounting standards approach intangibles, both in terms of definition and treatment. Shows that there is no conceptual framework commonly accepted and that there is a considerable lack of consistency both inter‐country and intra‐country. This challenges the principle of the acceptability of all international accounting standards by companies that wish to or are required to apply IASs. The disharmony highlighted by the advent of IAS 38 could be a sign of the failure of international accounting harmonization.