Voluntary disclosure of intellectual capital in New Zealand annual reports and the “hidden value”

Abstract

Purpose – The paper's purpose is to describe the extent and type of voluntary disclosure of intellectual capital (IC) in New Zealand, and to test for a relationship between “hidden value” (difference between firm's market and book value), and its relationship to voluntary IC disclosure in the annual reports of New Zealand companies. The study aims to incorporate the effect of revaluations and growth expectations.Design/methodology/approach – Content analysis of 70 publicly listed New Zealand firms, and database retrieval of independent variable data. Correlation and regression analysis is undertaken.Findings – Only revaluing firms show a significant positive relationship between their levels of hidden value and their voluntary disclosure of IC and its components of external and internal structure. Explanatory power is increased when an interaction term involving hidden value and growth expectations is introduced.Research limitations/implications – Further developments in the growth expectation and market ...