Intellectual capital reporting between a developing and developed nation

Purpose - This paper examines the patterns of intellectual capital reporting (ICR) of large listed firms in a developing nation, Sri Lanka. The aim of this study is to highlight the differences in ICR practice between developing and developed nations. Design/methodology/approach - The paper begins by examining each of the top 30 firms by market capitalization listed on the Colombo stock exchange in 1998/1999 and 1999/2000. Using the content analysis method, it reviews the annual reports of these firms to determine the types of intellectual capital (IC) items reported in Sri Lanka. It then compares these findings with a similar study undertaken in Australia during the same period (Guthrie and Petty, 2000). Findings - ICR differences were identified between Sri Lankan and Australian firms, and it is argued that that these differences can be attributed to economic, social and political factors. The paper highlights the need for a uniform ICR definition and a reporting framework that provides comparative and consistent reporting under the auspices of a regulatory body. Practical implications - This study highlights important policy issues for Australia, Sri Lanka and other nations. These issues are even more pertinent in the light of the gradual international adoption of the International Financial Reporting Standards (IFRS), formulated by the International Accounting Standards Board (IASB). Originality/value – Most papers on intellectual capital reporting have focused on firms in developed countries. This study offers insights into comparative reporting practices between a developed and a developing country

Intellectual accounting scorecard - Measuring and reporting intellectual capital

Several indicators are constructed to measure intellectual capital at inter-organisational and inter-organisational level. The majority of models constructed so far have not established the link between individual intellectual items and organisational intellectual capital performance. The few models that establish such a link demand significant management time to monitor them, or have established indices outside the traditional accounting system. The Intellectual Accounting Scorecard integrates intellectual capital measuring and reporting into mainstream traditional accounting reporting. Firstly it identifies each intellectual capital item as an intellectual revenue and intellectual expenses having an impact on the statement of income, or as an intellectual assets and intellectual liabilities having an impact on the balance sheet. Secondly, it constructs ratios to monitor operational and strategic performance

Intellectual capital disclosure trends: Singapore and Sri Lanka

Purpose - This paper investigates the intellectual capital disclosure trends and disclosure category differences of top 20 listed firms in a developing nation, Sri Lanka, and moderately developed nation, Singapore. The aim of this study is to highlight the differences in IC disclosure practice between developing and developed nations. Design/methodology/approach - The study investigates the top 20 firms by market capitalization listed on the Colombo stock exchange in 1998 to 2000. Using the content analysis method, it reviews the annual reports of these firms to determine intellectual capital disclosure trends in Sri Lanka. It then compares these findings with a similar unpublished study undertaken in Singapore during the same period (Cheng, Fok & Low, 2002). Findings – The study identified IC disclosure differences between Sri Lankan and Singapore firms, and suggest reasons for differences from country perspectives. The paper highlights the need for a uniform methodology in intellectual disclosure framework to establish consistent disclosure practices. Practical implications - This study highlights the need to establish a uniform methodology for financial disclosure under International Financial Reporting Standards (IFRS) that can mobilize globally uniform disclosure intellectual capital disclosure practices. Originality/value –This study offers insights into comparative trends in intellectual capital disclosure practices between a moderately developed and a developing country

Earnings quality and stress levels of Chinese listed companies

This paper investigates the relation between earnings quality and stress levels of Chinese companies listed in Shanghai and Shenzhen stock exchanges from 2003 to 2007 by classifying them as financially stressed and bankrupt (SB), financially stressed and not bankrupt (SNB), and not financially stressed and not bankrupt (NSNB) firms. We measure the earnings quality by four separate attributes: accruals quality, earnings persistence, earnings predictability, and earnings smoothness. We find that earnings quality levels are parallel to firm\u27s stress levels: the SB firms have the lowest earnings quality measured by each of the four earnings attributes, the SNB firms have a lower earnings quality compared with the SB firms, the NSNB firms have the highest earnings quality. We also find that the earnings quality deteriorated over the study period, the number of SB firms with the lowest earnings quality increased, and the number of NSNB firms with the highest earnings quality decreased for the fiscal years 2003 to 2007

Activity-based costing technology adoption in Australian universities

Strategic cost management is vital to the Australian university sector’s performance, and activity-based costing (ABC) is a widely accepted and used accounting technology assisting with this. We examine the status of ABC technology adoption in two categories—adopters and non-adopters of the technology—informed by Technology Diffusion Framework, Social Cognitive Theory and Dynamic Theory of Strategy. The study collected data by sending a pilot-tested survey questionnaire to senior executives for electronic completion. From the 39 universities that elected to participate, 24 usable responses were received, representing a 61% response rate. The data were analyzed using cognitive characteristics supported by Social Cognitive Theory, and organizational characteristics supported by the Dynamic Theory of Strategy of universities ABC technology adopter and non-adopter status. Cognitive characteristics provide a qualitative explanation, but selected determinants show no statistical significance. Organizational characteristics also provide a qualitative explanation and show organizational revenue is the most significant determinant; followed by universities located outside the cities, and in the southern part of Australia, have more propensity for ABC technology adoption