Managers' and auditors' perceptions of intellectual capital reporting

Abstract

Purpose -We aim to explore managers' & auditors' perceptions on intellectual capital measurement and reporting in Egyptian companies.Design/methodology/approach -The paper draws on a questionnaire survey sent to managers and external auditors were asked to provide their opinion about intellectual capital measurement and reporting for companies listed in the Egyptian Stock Exchange.Findings -We find significant differences between respondents' rates on IC indicators. These differences are due to different industry sectors involved in our sample. Further, we find that Egyptian listed firms do not either measure or report IC indicators in their annual reports. In addition, we find that auditors' responsibilities on IC reporting are ambiguous. Finally, we find that work experience is the main determinant of managers' perceptions on IC indicators, while professional education is the main determinant of external auditors' perceptions on IC indicators.Originality/value -Prior research on intellectual capital utilised the content analysis approach to measure levels of intellectual capital disclosure in annual reports. This paper add to the existing literature by utilising the results of a survey questionnaire distributed to managers working in (and auditors specialised in) Egyptian companies to explore their perceptions on intellectual capital measurement and reporting. Since prior research has focused on developed economies, we strongly believe that this paper provides a novel contribution to the existing literature as we are the first to examine this issue in Egypt.

Managing Intellectual Capital in Italian Manufacturing SMEs

“…Also, diverging choices have been made for HC; in particular, some scholars insert into this category motivation of employees, effectiveness of the remuneration system (Bozbura, 2004;Ahmed & Hussainey, 2010) and employees' incentive systems (Ahmed & Hussainey, 2010), which are part of ISC in most research; therefore, these elements have been incorporated into 'employee development system'.…”

“…Some scholars (Bontis, Keow & Richardson, 2000;Cabrita & Bontis, 2008;Sharabati, Jawad & Bontis, 2010;Chen, Elnaghi & Hatzakis, 2011;Suraj & Bontis, 2012) consider some training items in HC and some others in ISC, as training, on the one hand, enriches competence and, on the other, is part of the development system implemented by companies. In this research, training is considered within 'employee development system', according to the perspective that considers training from the firm's point of view (Lee, Ho & Chiu, 2008;Ahmed & Hussainey, 2010).…”

Preparers’ and users’ perception of intellectual capital information usefulness

“…A questionnaire survey was conducted to collect the required data. It is a self-constructed questionnaire based on a broad review of IC disclosure literature and inspired by similar type surveys (Béjar, 2006; Cauvin et al , 2006; Ahmed and Hussainey, 2010; Ferchichi, 2011; Ousama et al , 2011a, b; Boujelbene and Affes, 2013).…”

“…Previous studies have examined issues relating to the degree of recognition of the IC concept as well as to different perceptions of the IC information usefulness and IC measurement/disclosure practices in different countries, such as South Africa (April et al , 2003), Austria (Bornemann et al , 1999; Litschka et al , 2006), Canada (Miller et al , 1999), China (An et al , 2014), Egypt (Ahmed and Hussainey, 2010), the USA (Mavrinac and Siesfeld, 1998), France (Béjar, 2006; Cauvin et al , 2006), Hong Kong (Cuganesan et al , 2006), Malaysia (Ousama et al , 2011a, b), the UK (Hall, 1992) and Tunisia (Mezghani et al , 2007; Ferchichi, 2011; Boujelbene and Affes, 2013; Ferchichi and Paturel, 2016). These studies, focusing on the demand for IC information, were conducted from multiple perspectives, such as those of managers, investors, financial analysts and portfolios managers, academics, preparers and users of financial statements and stakeholders.…”

“…By exploring through a questionnaire survey the perceptions of managers and auditors on the IC reporting and measurement by Egyptian companies, Ahmed and Hussainey (2010) found significant differences between respondents’ ratings as to IC indicators, due to the variety of industrial sectors composing their sample. In addition, they noted that Egyptian listed firms neither measure nor report IC indicators in their annual reports.…”