European Journal of Accounting, Auditing and Finance Research (EJAAFR)

EA Journals

: Human Capital

Intellectual Capital and Shareholders’ Wealth. The Economic Value Added Approach (Published)

The role of intangible assets such as intellectual capital promoting corporate competitiveness and further shareholders’ value has attracted attention in the finance literature. This study investigated intellectual capital efficiency as a source of creating shareholders’ wealth in Nigeria. To achieve the study’s aim, correlational research design was adopted. The study’s data were collected from content analysis of financial statements of listed service companies in Nigeria.  The sample used in this study includes 17 service firms listed on the Nigeria Exchange Group from 2011 to 2022. The VAIC model was utilized to estimate intellectual capital. Descriptive statistics were conducted while some diagnostic tests were piloted before the regression analysis.    The random effect regression model was used to verify whether the studied variables impact shareholders’ wealth of listed service companies in Nigeria. Findings indicated that value added intellectual coefficient as a measure of intellectual capital has a significant positive association with shareholders’ wealth. Results further revealed that human capital efficiency, relational capital efficiency and capital employed efficiency (as components of intellectual capital) are significantly and positively associated with shareholders’ wealth while structural capital efficiency has a positive but not significant relationship with shareholders’ wealth creation. The study concludes that efficient management of intellectual capital can enhance shareholders’ wealth in listed service companies in Nigeria and recommends amongst others that firms should make strategic plans regarding intellectual capital and intangible assets as it can increase corporate competitive advantage.


Keywords: : Human Capital, Intellectual Capital, Relational capital, Shareholders Wealth, capital employed, economic value added, structural capital

Spatial Dimension of Regional Economic Growth in Sumatera Island (Published)

This study aims to examine and analyze the influence of economic growth determinants and economic growth spillover on the economic growth of the regencies/the cities in Sumatra Island. This study uses a quantitative analysis model of Moran’s I Global, Spatial Autoregressive Model (SAR) with weighted matrix of six and eight in the neighboring areas. The determinants of economic growth are explained by labor, human capital, catch-up technology, market potential, agricultural sector contribution, industrial sector and service sector. Based on the analysis of Moran’s I, the spatial dependence of economic growth between regencies/cities is significant in Sumatra Island. Based on SAR model, it is concluded that the spillover of economic growth, labor, contribution of agriculture sector, service sector and market potential have positive and significant influence; the contribution of industrial sector has positive but insignificant influence; while human capital and catch-up technology have negative and significant influence on the economic growth of a regency/city in Sumatra Island.

Keywords: : Human Capital, Catch-Up Technology, Contribution Of Agriculture Sector, Labor, Market Potential, Moran's I, Service Sector, Spatial Autoregressive Model (SAR), The Spillover Of Economic Growth


This study examines the Impact of Human Capital Accounting(HCA) on financial performance and market valuation using four publicly quoted companies(banks) in Nigeria. It presents a comparative analysis between the current accounting practice of corporate valuation(net worth) and what it should be if investments on human capital are treated as assets, capitalised and amortized over the useful life span of the assets. Data for this study were sourced through questionnaire which were administered to a randomly selected respondents of accountants of management cadre. Secondary data were sourced from the annual financial statements of five selected firms, relevant textbooks and the internet. Data were analysed using percentages and Chi-Square statistical test. The study reveals among others that there is a significant increase in firms’ networth when investments on human capital are treated as assets and capitalized as against the current practice where such expenditures are treated as mere revenue expenses thereby leading to gross undervaluation of firms’ Statement of Financial Position(Balance Sheet) and the Income Statement (Profit and Loss Account). The study recommends that investment in human capital should be treated as asset and so amortised over the expected period of service while the current practice of writing-off the annual investment on human capital from the the year’s income statement should be discouraged as the practice grossly undervalues firms. Relevant regulatory bodies such as Financial Reporting Council of Nigeria, SEC, CBN, NDIC and so on are implored to make laws that will compel quoted firms to compulsorily integrate HCA in their financial reports.

Keywords: : Human Capital, Corporate Valuation, Financial reports, Human Assets, Human Capital Accounting

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