INTELLECTUAL CAPITAL ACCOUNTING AND FINANCIAL PERFORMANCE OF QUOTED BANKS IN NIGERIA.

Dr Solomon Egbe

Dr Solomon Egbe University of Port Harcourt, Choba, Nigeria

Keywords: Intellectual Capital Accounting, Structural Capital Accounting, Value Addition Intellectual Capital Accounting.

Abstract

Knowledge management, skills, innovation and technological advancement have been the distinctive attributes of modern business organizations. The success and continuity of business corporations result from continuous innovation, application of new technological discoveries, and enhancement of the skills and knowledge of their workers instead of tangible assets like plant, property and equipment to produce expected performance. Corporate management have embraced the power of knowledge because of its ability to generate value though denied recognition and accountability in the financial statements. The Nigerian financial sector is a highly competitive type with each stakeholder struggling to lead to market. However, the success and excellence in such competitive environment depend immensely on the application of skills management, creativity and innovation. Despite that these intangible assets (intellectual capita!) have measurement difficulties, they are inevitable in the successful management of modern business enterprises. This study x-rayed the impact of intellectual capital accounting on the financial performance of quoted commercial banks in Nigeria, for the period of 2010 to 2016. It focused on value added intellectual capital, and structural capital as predictor variables while Net Profit Margin, and Return on equity are the response (dependent) variables. Multiple regression analysis with the aid of SPSS version 20 was used. The findings indicated that Human Capital (HC), has positive relationship with net profit margin (NPM) and Return on Equity (ROE) as indicated by the obtained significance values of 0.988 and 0.726, against the critical significance value of 0.05 respectively. The implication of this result is that intellectual capital makes constructive contribution towards the impressive performance of the banking industry and as a result, should be separately accounted for in the statement of financial position.

Author Biography

Dr Solomon Egbe, University of Port Harcourt, Choba, Nigeria

Department of Accounting Faculty of Management Sciences,

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