CORPORATE VALUE CREATION ON INTANGIBLE ASSETS AND VOLUNTARY DISCLOSURE IN NIGERIA.






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CORPORATE VALUE CREATION ON INTANGIBLE ASSETS AND VOLUNTARY DISCLOSURE IN NIGERIA.


TABLE OF CONTENTS
CHAPTER ONE: INTRODUCTION
1.1   content of the problem
1.2   statement of problem
1.3   the purpose of the study
1.4   research question
1.5   hypothesis
1.6   the significance of the study
1.7   limitation of the study
1.8   definition of terms
1.9   organization of the study
CHAPTER TWO: REVIEW OF RELEVANT LITERATURE
2.0   Introduction
2.1   an overview of intangible assets
2.2   classification of intangible assets
2.3   standards on recognition and accounting for intangible assets
2.3.1 international accounting standard (IAS 38) provision
2.3.2 measurement and value impact of intangible asset
2.4.1 for acquired intangible assets
2.4.2 for internally generated intangible assets
2.4.3 past expenses not to be recognized as an asset
2.4.4. measurement models
2.4.5 useful life of intangible assets
2.4.6 intangible assets with finite useful lives
2.4.7 intangible assets with definite useful lives
2.5   value impact of intangible assets on corporate performance
 2.5.1 research and development
2.5.2 advertising
2.5.3 brands and trademarks
2.5.4 human resources (i.e. intellectual property)
2.6   disclosure of intangible assets in annual reports
2.6.1 relevance of voluntary disclosure
2.6.2 conclusion
CHAPTER THREE: METHODOLOGY
3.0   Introduction
3.1   research design
3.2   sampling procedure/sample size determination
3.3   data collection method
3.4   test of validity and reliability
3.5   operational measures of the variables
3.6   data analysis techniques
Questionnaire


CHAPTER ONE
INTRODUCTION
1.1   CONTEXT OF THE PROBLEM
In recent years, intangible assets have been identified as major levers of value creation in many industries. Consequently, investor are strongly interested in obtaining information about the intangible assets stock of companies (Marasca,  2003). According to Titular (2008), during the last two decades we have progressively moved into a knowledge based, fast changing and technology intensive economy in which investments in human resources, information technology, research and development and advertising have become essential in order to maintain the firms competitive position and ensure its future viability. Goldfinger (1997) submits that the source of economic value and wealth is no longer the production of material goods but the creation and manipulation of intangible assets. In this scenario, corporate entities feel a growing need to make investments in intangible resources on which the future success of the company is based.
Leandro (2000) defines intangibles assets in accordance with the provision IAS 38 (IASC, 1998b)as non-monetary production or supply of goods or services, for rental to other, or for administrative purposes: (a) that are identifiable (b) that are controllable by an enterprises as a result of events, and (c) from which future economic benefits are expected to flow to the enterprise. Considering the vast and complex nature of these corporate resources, Mortensen, Eustace and Lannoo (2009) propose a five category classification of intangible in financial perspective such include: innovation capital (ie R&D), structural capital (i.e. intellectual capital and knowledge assets, organizational coherently and flexibility, workforce skill and loyalty). Executor contracts (i.e. operating liencenses and franchises media and other broadcast lences etc), Market capital (i.e. brands trademarks and mask heads) and goodwill.
Looking at the vast scope of intangibles and its characteristic value creative impact on the business organization, in particular and the economy at large; most advanced and emerging economics have channeled focus on how to recognize and measure the inherent value.
In response to this yearning, some international and national standard setting bodies have prescribed standards and rules for recognizing and reporting the value of intangible assets in corporate performance. Such include the provisions of international accounting standard (IAS38), GAAP in U.S, GASB in Germany, ASB in UK, ASSB in Australia, NASB in Nigeria etc. consequent on this, the periodic disclosure of recognized impact of intangible assets in the value creation extend of the corporate entity attracts the interest of financial information users especially the investors.
The Nigerian scenario may not be uncommon with the global perception on the inherent economic benefits of intangible assets in corporate performance. However, the need to ascertain the prevailing situation in Nigeria corporate reporting framework and practice in relation to the matter will form the background on which the study will spring.

1.2   STATEMENT OF PROBLEM
Several corporate entities feel a growing need to undertake important investments in their human resources, new technology, research and development, knowledge-based assets and other intangible on which the future success of the company is based, but in most cases these investment are not reflected to balance sheet due to the existence of very restrictive accounting criteria for recognition and valuation of these asserts.
As a consequence, annual reports are becoming less informative on the firms current financial position and future prospect because they provide acceptable estimates of performance but not reliable position of the value of the company. This situation sends negative impression on existing and prospective stakeholders of the firms. However, volumes of literature reveal prescribed standards on and disclosure of intangible assets by standard setting bodies of international and national reporting jurisdiction.


1.3   THE PURPOSE OF THE STUDY
The study will aim at the following:
1.     To identify the relevant intangible assets in corporate perspective.
2.     To examine the standards for recognition and valuation of intangible assets in Nigeria.
3.     To assess the value creation, impact of these assets if any.
4.     To ascertain the regulatory framework on disclosure of intangible assets value in annual reports.
5.     To consider the extend of disclosure among relevant corporate entities.
1.4   RESEARCH QUESTION
The following research questions will guide the direction of enquiry.
1.     To what extend are intangible assets recognize and valued?
2.     To what extend does research and development foster the corporate value of firms?
3.     To what extend does goodwill cause increase in corporate value?
4.     To what extend do other intangible assets influence corporate performance?
5.     To what extend does voluntary disclosure impact on investment?
1.5   HYPOTHESIS
The study will test the following hypothesis:
H01: there is no significant relationship between intangible assets existence and corporate value created.
H02: The level of corporate performance does not depend on the level of intangible assets recognized.
H03: There is no significant relationship between disclosure of intangible assets and reporting standard in Nigeria.
H04: The level of voluntary disclosure of intangible assets does not impact on the level of investment.

1.6   THE SIGNIFICANCE OF THE STUDY
The findings of the study will contribute immensely to existing stock of knowledge. It will serve as a source of reference to further studies and provide opportunities for more inquiry. To practitioners in the corporate organizations, it will reveal the hidden treasures of knowledge about intangible assets in relation to corporate value creation. Besides, the investors and government will be enlightened on the value driver in corporate reporting setback for critical attention.
1.7   LIMITATION OF THE STUDY
Considering the purpose of the study, the following setbacks will be expected.
1.     The frame of time to accomplish the study will be inadequate; as such detailed inquiry shall be overlooked.
2.     Access to adequate relevant material will also pose some limitation. This is dependent on the fact that the study focuses on disclosure of true corporate valued which some management personnel may perceive different.
3.     The disposition of respondent to provide relevant answers to research questions will also limit the study.
4.     All successful research work involved financial implication. The lack of adequate financial resources at our disposal will also mitigate the extend of inquiry.
1.8   DEFINITION OF TERMS
For the purpose of clarity and in the context of this study, the following will be defined as:
1.     Intellectual Capital: Financial capita for knowledge based intangible assets.
2.     Financial Capital: Financial resources channel to an aspects of intangible assets; such as brands, trade mark, patent, mastheads etc.
3.     Innovation Capital: Financial resources budgeted for or expended in research and development.
4.     GASB: Mean German Accounting Standard Board
5.     ASB: Accountings standard board in united kingdom
6.     ASSB: Accounting Standard setting board
1.9   ORGANIZATION OF THE STUDY
The study will be organized into five chapters. In chapter one will be the introduction of the subject matter. It will consider the context of the problem, statement of the problem, purpose of the study, research question, hypothesis, and significance of the study, definition of terms, limitation of the study and organization of the study.
The second chapter will focus on review of relevant literature. The chapter three will address the methodology of the study. In it will be considered, research design, sampling procedure and size, data collection method, operational measures of variable and data analysis technique.
Chapter four consider presentation and analysis of data collected while chapter five will discuss the findings, make collection and necessary recommendation.




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