Journal of Accounting and Taxation
Subscribe to JAT
Full Name*
Email Address*

Article Number - 73F3C2367037


Vol.9(11), pp. 147-160 , December 2017
https://doi.org/10.5897/JAT2017.0246
ISSN: 2141-6664


 Total Views: 0
 Downloaded: 0

Full Length Research Paper

The impact of intellectual capital on the financial performance of listed Nigerian food products companies



Shafi’u Abubakar Kurfi
  • Shafi’u Abubakar Kurfi
  • Department of Accounting, Umaru Musa Yar’adua University, Katsina State, Nigeria.
  • Google Scholar
Noraza Mat Udin
  • Noraza Mat Udin
  • Tunku Putri Intan Safinaz School of Accountancy, Universiti Utara Malaysia, Malaysia.
  • Google Scholar
Saleh Muhammad Bahamman
  • Saleh Muhammad Bahamman
  • Department of Accountancy, Gombe State University, Gombe State, Nigeria.
  • Google Scholar







 Received: 02 January 2017  Accepted: 26 July 2017  Published: 31 December 2017

Copyright © 2017 Author(s) retain the copyright of this article.
This article is published under the terms of the Creative Commons Attribution License 4.0


This study examines the impact of intellectual capital (IC) on financial performance of listed Nigerian food products companies for five year period 2010 to 2014 by adopting Pulic model of IC known as value added intellectual coefficient (VAIC). Regression models are used to test the hypotheses of the study where the results show that there was positive significant influence of IC on financial performance. Specifically, the results showed that structural capital (SC) and capital employed (CE) influence the financial performance of Nigerian food products companies. Based on the resource-based theory, the results prove that companies can enhance financial performance by emphasising on IC especially in food products companies.

 

Key words: Intellectual capital, VAIC, financial performance, Nigeria.

Abdulsalam F, Al-Qaheri H, Al-Khayyat R (2011). The Intellectual Capital Performance of Kuwaiti Banks: An Application of VAIC Model. iBusiness 3(1):88-96.

 

Abogan OP, Akinola EB, Baruwa OI (2014). Non-oil export and economic growth in Nigeria (1980-2011). J. Res. Econ. Int. Finance. 3(1):1-11.

 
 

Ademola OJ, Kemisola OC (2014). Working capital management and profitability of selected quoted food and beverages manufacturing firms in Nigeria. European J. Accounting Auditing Finance. 2(3:10-21.

 
 

Ahangar RG (2011). The relationship between intellectual capital and financial performance: An empirical investigation in an Iranian company. Afr. J. Bus. Manage. 5(1):88-95.

 
 

Akpinar AT, Akdemir A (2002). Intellectual Capital. Dspace.Xmu.Edu.Cn. pp. 332-340.

 
 

Al-Musali MAK, Ismail KNIK (2014). Intellectual capital and its effect on financial performance of banks: evidence from Saudi Arabia. Procedia – Soc. Behav. Sci. 164(164):201-207.
Crossref

 
 

Almusali MAKM (2009). The influence of intellectual capitalon financial performance of banks listed in Bahrain.

 
 

Al-shubiri FN (2013). The impact of value added intellectual coefficient components on financial health. Rev. Int. Comparative Manage. 14(962):459-472.

 
 

Amin S, Aslam S, Makki MAM (2014). Intellectual capital and performance of pharmaceutical firms in Pakistan. Pak. J. Soc. Sci. 34(2):433-450. Retrieved from 

View.

 
 

Anne-Laure M, Nick B (2013). Intellectual capital and performance within the banking sector of Luxembourg and Belgium. J. Intell. Capital 14(2):286-309.
Crossref

 
 

Anuonye NB (2015). Intellectual capital measurement: using the earnings per share model of quoted insurance companies in Nigeria. Int. Bus. Manage. 10(1):88-98.

 
 

Appuhami BA (2007). The impact of intellectual capital on investors' capital gains on shares: An empirical investigation of Thai banking, finance & insurance sector. Int. Manage. Rev. 3(2):14-25.

 
 

Appuhami R, Bhuyan M (2015). Examining the influence of corporate governance on intellectual capital efficiency Evidence from top service firms in Australia. J. Intell. Capital 30(4/5):347-372.

 
 

Arslan M, Zaman R (2014). Intellectual performance: A study of oil and gas sector of Pakistan. Int. Letters Soc. Humanistic Sci. 43:125-140.
Crossref

 
 

Asare N, Simpson SNY, Onumah JM (2013). Exploring the disclosure of intellectual capital in Ghana: Evidence from listed companies. J. Account. Market. 2(3).
Crossref

 
 

Barney J (1991). Firm resources and sustained competitive advantage. J. Manage. 17(1):99-120.
Crossref

 
 

Berry J (2004). Tangible strategies for intangible assets: How to manage and measure your company's brand, patents. Intellectual property and other services of value. Mcgraw-Hills Publishers company, New York.

 
 

Berzkalne I, Zelgalve E (2014). Intellectual Capital and Company Value. Proc. – Soc. Behav. Sci. 110:887-896.
Crossref

 
 

Bharathi KG (2015). Impact of intellectual capital on financial performance and market valuation of firms in India. Int. Lett. Soc. Humanistic Sci. 48:107-122.
Crossref

 
 

Bontis N (1998a). Intellectual capita: An exploratory study that develops measures and models. Manage. Decision 36(2):63-76.
Crossref

 
 

Bontis N (2000b). Intellectual capital and business performance in Malaysian industries. J. Intellect. Capital. 1(1):85-100.
Crossref

 
 

Bornemann M, Knapp A, Schneider U, Sixl K I (1999). Measuring and reporting intellectual capital: Experience, issues, and prospects. Int. Symposium. pp. 1-34.

 
 

Brooking A (1996). Intellectual capital. London: International Thomson Business Press.

 
 

Broring S, Cloutier LM (2008). Value-creation in new product development within converging value chains: An analysis in the functional foods and nutraceutical industry. Brit. Food J. 110(1):76-97.
Crossref

 
 

Business Day (2015). Honeywell posts N1.4bn profit. Business Day.

 
 

Chan KH (2011). Impact of intellectual capital on organisational performance: An empirical study of companies in the Hang Seng Index. Learn. Org. 16(1):22-39.
Crossref

 
 

Chen MC, Cheng SJ, Hwang Y (2005). An empirical investigation of the relationship between intellectual capital and firms' market value and financial performance. J. Intellect. Capital. 6(2):159-176.
Crossref

 
 

Chinaemerem OC, Anthony O (2012). Impact of capital structure on the financial performance of Nigerian firms. Arabian J. Bus. Manage. Rev. 1(12):43-61.
Crossref

 
 

Choudhury J (2010). Performance impact of intellectual capital: A study of Indian IT Sector. Int. J. Bus. Manage. 5(9):72-80.
Crossref

 
 

Clarke M, Seng D, Whiting RH (2011). Intellectual capital and firm performance in Australia. J. Intellect. Capital. 12(4):505-530.
Crossref

 
 

Dadashinasab M, Sofian S (2014). The impact of intellectual capital on firm financial performance by moderating of dynamic capability. Asian Soc. Sci. 10(17):93-100.
Crossref

 
 

Deep R, Narwal KP (2014). Intellectual capital and its association with financial performance: A study of Indian textile sector. Int. J. Manage. Bus. Res. 4(1):43-54.

 
 

Djamil AB, Razafindrambinina D, Tandeans C (2013). The impact of intellectual capital on a firm's stock return: Evidence from Indonesia. J. Bus. Stud. Quart. 5(2):176-183.

 
 

Drucker PF (1993). Post-capitalsit society. Engstrom, T. E. J., Westnes, P., & Westnes, New York: Harpercollins Publishers Inc.

 
 

Durham K, Kennedy B (1997). Intellectual capital: Realizing your company's true value by finding its hidden brainpower. Res. Technol. Manage. 40(5):59.

 
 

Esu GE, Udonwa U (2015). Economic diversification and economic growth: Evidence from Nigeria. J. Econ. Sustain. Dev. 6(16):56-69.

 
 

Fathi S, Farahmand S, Khorasani M (2013). Impact of intellectual capital on financial performance. Int. J. Acad. Res. Econ. Manage.

 
 

Sci. 2(1):6-18.

 
 

Firer S, Williams SM (2003). Intellectual capital and traditionalmeasures of corporate performance. J. Intellect. Capital. 4(3):348-360.
Crossref

 
 

Gan K, Saleh Z (2008). Intellectual capital and corporate performance of technology-intensive companies: Malaysia evidence. Asian J. Bus. Account. 1(1):113-130.

 
 

Garcia-Ayuso M (2003). Intangibles: Lessons from the past and a look into the future. J. Intellect. Capital. 4(4):597-604.
Crossref

 
 

Graziano AM, Micheal RL (1993). Research methods: Process of inquiry. Harpercollins College Publishers.

 
 

Hair J, Joseph F. Hair, Black B, Babin B, Anderson RE, Tatham RL (2006). Multivarate data analysis. (S. Katie & S. Kelly, Eds.) (Six edition). United States of America: Pearson Education Inc.

 
 

Hudson WJ (1993). Intellectual capital: How to build it, enhance it use it. United States of America: John Willey & Sons Inc.

 
 

Iavorskyi M (2013). The Impact of Capital Structure on Firm Performance: Evidence From Ukraine. Master of Finance Economics Thesis, Kyviv School of Economics.

 
 

Kalkan A, Bozkurt OC, Arman M (2014). The impacts of intellectual capital, innovation and organizational strategy on firm performance. Procedia – Social and Behavioral Sciences, 150, 700–707. 
Crossref

 
 

Kamal MHM, Mat RC, Rahim NA, Husin N, Ismail I (2011). Intellectual capital and firm performance of commercial banks in Malaysia. Asian Econ. Financial Rev. 2(4):577-590.

 
 

Kamath GB (2007). The intellectual capital performance of Indian banking sector. J. Intellect. Capital. 8(1).

 
 

Khalique M, Shaari JA, Isa AH (2011). Relationship of intellectual capital with the organizational performance of commercial banks in Islamabad, Pakistan. 

 
 

Khan FA, Khan RAG, Khan MA (2012). Impact of intellectual capital on financial performance of banks in Pakistan: Corporate restructuring and its effect on employee morale and performance. Int. J. Bus. Behav. Sci. 2(6):22-30.

 
 

Kline RB (2005). Principles and Practice of Structural Equation Modelling. New York: Guilford Publications.

 
 

Kujansivu P, Lonnqvist A (2007). Investigating the value and efficiency of intellectual capital. J. Intellect. Capital. 8(2):272-287.
Crossref

 
 

Kurawa JM, Kabara AS (2014). Impact of corporate governance on voluntary disclosure by firms in the downstream sector of the Nigerian petroleum industry. In Proceedings of World Business Research Conference (1–19).

 
 

Laing G, Dunn J, Hughes-Lucas S (2010). Applying the VAICTM model to Australian hotels. J. Intellect. Capital. 11(3):269–-283.
Crossref

 
 

Lee AM, McKinney J (2012). Understanding and Applying Research Design, John Wiley & Sons, Inc., Hoboken, NJ, USA.

 
 

Leedy PD, Ormrod JE (2010). Practical research planning and design. Pearson Education Inc.

 
 

Lina AS (2014). The influence of intellectual capital components towards the company performance. J. Manage 14(1):125-140.

 
 

Luthy D (2008). Intellectual capital and its measurement. InProceedings of the Asian Pacific Interdisciplinary Research in Accounting Conference (APIRA), Osaka, Japan 1998 Aug 4. pp. 16-17.

 
 

Maditinos D, Chatzoudes D, Tsairidis C, Theriou G (2011). The impact of intellectual capital on firms' market value and financial performance. J. Intellect. Capital. 12(1):132-151.
Crossref

 
 

Maditinos D, Sevic Z, Tsairidis C (2010). Intellectual capital and business performance: An empirical study for the Greek Listed Companies. Eur. Res. Stud. XIII(3):145-167.

 
 

Makki MAM, Lodhi SA (2008). Impact of intellectual capital efficiency on profitability (A case study of LSE25 companies). Lahore J. Econ. 2(13):81-98.

 
 

Mariya AM, Shakina EA (2014). Article information: J. Intellect. Capital. 15(2):206-226.

 
 

Mehri M, Umar MS, Saeidi P, Hekmat RK, Naslmosavi S (2013). Intellectual capital and firm performance of high intangible intensive industries: Malaysia evidence. Asian Soc. Sci. 9(9):146-155.
Crossref

 
 

Muhammad NMN, Ismail MK A (2009). Intellectual capital efficiency and firm's performance: Study on Malaysian financial sectors. Int. J. Econ. Finance 1(2):206-212.
Crossref

 
 

Musibah AS, Alfattani WSBWY (2013). Impact of intellectual capital on corporate social responsibility evidence from Islamic banking sector in GCC. Int. J. Finance Account. 2(6):307-311.

 
 

Najibullah S (2005). An empirical investigation of the relationship between intellectual capital and firms' market value and financial performance. J. Intellect. Capital. P1-20.

 
 

Nezakati H, Ali NA, Mansouri S, Ang SH (2011). Adapting elements of market value coverage in adoption and diffusion of innovations - fast food industries (preliminary study). Aust. J. Basic Appl. Sci. 5(9):1271-1276.

 
 

Nigerian Stock Exchange (2013). NSE FACTBOOK 

 
 

Nimtrakoon S (2015). The relationship between intellectual capital, firm's market value and financial performance: Empirical evidence from the ASEAN. J. Intell. Capital. 16(3):587-618.
Crossref

 
 

Okpala PO, Chidi OC (2010). Human capital accounting and its relevance to stock, investment decisions in Nigeria. Eur. J. Econ. Finance Admin. Sci. 21(21):64-76.

 
 

Ong TS, Yeoh LY, Teh BH (2011).Intellectual capital efficiency in Malaysian food and beverage industry. Int. J. Bus. Behav. Sci. 1(1).

 
 

Onodugo V, Ikpe M, Oluchukwu A (2013). Non-oil export and economic growth in Nigeria: A time series econometric model. Int. J. Bus. Manage. Res. 3(2):115-124.

 
 

Pouraghajan A, Malekian E (2012). The relationship between capital structure and firm performance evaluation measures: Evidence from the Tehran Stock Exchange. Int. J. Bus. Commerce. 1(9):166-81.

 
 

Pulic A (1998). 2nd McMaster world congress on measuring and managing intellectual capital by the Austrian team for intellectual potential. In Measuring the performance of intellectual potential in knowledge economy. pp. 1-20.

 
 

Rehman WU, Rehman HU Usman M, Asghar N (2012). A link of intellectual capital performance with corporate performance: Comparative study from banking sector in Pakistan. Int. J. Bus. Soc. Sci. 3(12):313-321.

 
 

Roos G, Roos J (1997). Measuring your company's intellectual performance. Int. J. Strat. Manage. 30(3):413-426.

 
 

Salman RT, Mansor M, Babatunde AD, Tayib M (2012). Impact of intellectual capital on return on asset in Nigerian manufacturing companies. Interdiscipl. J. Res. Bus. 2(4):21-30.

 
 

Salman RT, Dandago KI (2013). Intellectual capital disclosure in financial reports of Nigerian companies. In Intellectual capital disclosure in financial reports of Nigerian companies. pp. 1-17.

 
 

Sekaran U, Roger B (2013). Research Methods for Business. India: John Wiley & Sons Ltd. Service, F. I. R: Information circular: No: 9701 (1997).

 
 

Sledzik K (2013). The intellectual capital performance of polish banks: An application of VAICTM model. Financial Internet Quart. 9(2):92-100.

 
 

Stahle P, Stahle S, Aho S (2011). Value added intellectual coefficient (VAIC): acritical analysis. J. Intellectual Capital. 12(4):531-551.
Crossref

 
 

Thisday (2015). Honeywell holds AGM, posts N1.4bn profit. Thisday pp.

 
 

Tseng CY, Goo YJJ (2005). Intellectual capital and corporate value in an emerging economy: Empirical study of Taiwanese manufacturers. R and D Manage. 35(2):187-201.
Crossref

 
 

Xu D, Huo B, Sun L (2014). Relationships between intra-organizational resources, supply chain integration and business performance. Ind. Manage. Data Syst. 114(8):1186-1206.
Crossref

 
 

Yusuf I (2013). The relationship between human capital efficiency and financial performance: An empirical investigation of quoted Nigerian banks. Res. J. Finance Account. 4(4):148-155.

 
 

Zeghal D, Maaloul A (2010). Analysing value added as an indicator of intellectual capital and its consequences on company performance. J. Intell. Capital. 11(1):39-60.
Crossref

 

 


APA Kurfi, S. A., Udin, N. M., & Bahamman, S. M. (2017). The impact of intellectual capital on the financial performance of listed Nigerian food products companies. Journal of Accounting and Taxation, 9(11), 147-160.
Chicago Shafi’u Abubakar Kurfi, Noraza Mat Udin and Saleh Muhammad Bahamman. "The impact of intellectual capital on the financial performance of listed Nigerian food products companies." Journal of Accounting and Taxation 9, no. 11 (2017): 147-160.
MLA Shafi’u Abubakar Kurfi, Noraza Mat Udin and Saleh Muhammad Bahamman. "The impact of intellectual capital on the financial performance of listed Nigerian food products companies." Journal of Accounting and Taxation 9.11 (2017): 147-160.
   
DOI https://doi.org/10.5897/JAT2017.0246
URL http://www.academicjournals.org/journal/JAT/article-abstract/73F3C2367037

Subscription Form