SOURCE:

Faculty: Management Sciences
Department: Accountancy

CONTRIBUTORS:

Amahalu, N. N.
Okoye, E. I.

ABSTRACT:

This study assessed the influence of Intellectual Capital on Firm’s Financial Performance with a focus on selected quoted service firms in Nigeria. This study adopted cross-sectional analysis of all the firms quoted on the Nigerian Stock Exchange as at 31st December 2014, for a period of fifteen years (2000-2014). This allows for comparison of the performance of intellectual capital indices among the firms considered in this study. Ten sectors containing thirty five firms which made up the service sector were all selected for this study. Panel Data was employed in this study. The researchers made use of Ex-post facto research design in conducting the research. The study made use of secondary data obtained from fact books and annual report and accounts of the selected quoted service firms in Nigeria as at 31st December 2014. The relevant data obtained were subjected to statistical analysis using E-view 9.0. Correlation co-efficient, regression analysis, variance inflation factors, and white heteroskedasticity test were employed to analyse the data that were collected and tested the hypotheses that were formulated. The analysis of data was done using the Value Added Intellectual Coefficient (VAICTM) model to measure the efficiency of value added of tangible and intangible assets used by a firm in its operation. The results of this study revealed that there is a positive and statistically significant relationship between intellectual capital and financial performance of service firms in Nigeria. The researcher recommends the recognition of Intellectual Capital as an important business resource.

Keywords: Intellectual Capital, Firm’s Market Value, Financial Performance