The Role Of Intellectual Capital Information On The Narrative Sections Of Corporate Annual Reports

With the ever increasing pace of change in the world, today’s market leader can be out of business tomorrow if the organisation fails to adapt to the changes around it. One of the key assets of each organisation is its human capital, i.e. the knowledge, skills and abilities of its staff. If the organisation is to adapt,

Though classic and modern economic thinking have significant difference in theory and concept of human capital, they still have the same methodology. They set out with the same goal, in example, trying to explain the secrets of success (and failure) of a nation: why and how a nation managed to reach economic growth and generates prosperity. The methodological basis, either in classic or modern economic thinking, believes that the concept of human capital is only sensible and has a practical implication if understood in the whole framework. For that reason, it is very interesting to see the significance and meaning of the concept of human capital in the global context.

In this individual assignment I have chosen “HUMAN CAPITAL DEVELOPMENT” as my topic. In this assignment I discussed human capital development as it is related to Human Resource Management.

Each company must prepare financial statements to provide a comprehensive picture about its past performance and situation for the owners, the managers, the state and other stakeholders as well. In the case of enormous, international public limited companies like Ford and Microsoft these statements and data are public, so anybody can reach them through the internet. Moreover, we can also compute a lot of financial ratios based on these data. If we want to get an authentic frame about the firms, we have to know what these statement and ratios mean. In addition, it’s difficult for the companies that they want to give other picture about their financial status to

The strategic use of human resources is essential for all organisations that have objectives involving growth and stability. Therefore, it is essential for companies to closely examine their practices regarding their human capital to ensure a successful working environment. A selection of the major strategies and topics involving human capital are illustrated in the following report. Crackberry Communications should use this information to analyse potential risks and opportunities their human resource managers face.

According to Csintalan and Badulescu (2015), human capital refers to a stock of skills, knowledge, creativity, social and personality attributes, qualification of a worker (innate or acquired) that contribute to its productivity and ability to produce economic value (p. 668). Human capital is an impalpable quality that is not possessed by the establishment employing the workers, but rather renting these competencies from the employees. These rented skills may be the most valuable assets needed to support educators in an educational organization. For instances, education has the teacher as employees, and some of the skills necessary in the classroom are patience, adaptability, teamwork, communication, and leadership. The skills described

Human capital, structural capital, and relational capital are valuable elements of Intellectual Capital, nonetheless, we primarily focus on improving the innovation process and the intangible assets. Our knowledge capabilities are essential success utilities that propel the collaboration and motivation among employees. In concordance to the OKCA article, intellectual capital is especially needed for innovative technology enterprises, which is relevant since the organization itself is a segment of a larger enterprise network renown as the Pasco Enterprise Network or the Pasco Economic Development Council. Our intellectual capital audit further helps track and trace the records and strategy execution that are interconnected to (1) patents, (2)

This highlights that people abilities, behavior and personal energy make up the human capital they bring to an organisation. The knowledge, skills and abilities of individuals create the value and as such the emphasis should be attracting, retaining and developing that human capital. An individual’s ability to generate, retain and use knowledge further creates intellectual capital, then comes in social capital which generate longstanding knowledge which is now part of the organisation and creates organizational capital. This theory acknowledge people as assets and stresses that the investment in people by organizations will bring worthwhile

The report of the general purpose of financial reporting outlines an importance of ensuring about what companies disclosure on the PP&E in the report in regards to the qualitative characteristics of useful financial information by the general purpose financial reporting. The report investigates how this company meets the disclosures requirements for PP&E as per AASB116 as well as what extents the disclosures on the PP&E contain the fundamental and enhancing qualitative characteristics of useful

6. Often we expect to observe less voluntary disclosure by companies in emerging market countries than by those in developed countries:

The income statement, balance sheet and statement of cash flow are the biggest financial statements released by all publicly traded corporations; within different market sectors there are other standard forms that are released as well. These statements allow investors and potential investors a great deal of insight into the specifics of the business rather than just having to take someone’s word at a press conference on how it is functioning.

Moreover, information in the free market is meaningful which enhances investors’ understandability of the market thus creates an efficient financial reporting. Trading accounting information as a commodity, the most common incentive of free market reporting is to offer information which assists the investors to evaluate the firms’ operating earnings (Asher, Sarah and Benjamin, 2011). Finally, the free market possess a great magnitude of information. Even if the disclosures in a free market is voluntary, it contains a large scope of information which benefits the decision makers. Lang and Lundholm (1996) indicated that companies with supplementary information disclosures predict future earnings more accurately. Under the non-GAAP metrics in free market, another benefit is high relevance of information. In the unregulated environment, the value of information is more relevant as price and earnings are highly related (Albring et al. 2010). Even though the analysts failed to predict the occurrence of global financial crisis (GFC), the quick spread of bad events offers valuable information to the users and enables the participants to anticipate future risks which helps the vulnerable market recover in a high speed (Wilson, 2011).

Abstract: It is well known that knowledge economy is mainly based on intellectual capital. Intellectual capital plays a key role in enterprise’s value promotion. In fact, the good intellectual capital control system can bring the positive influence to the enterprise achievements. It is important to make empirical research on the relationship between intellectual capital and company performance to create value and enhance the enterprise achievements.

Intellectual capital has attracted considerable interest from both academics and practitioners. Research in this area has highlighted the importance of intellectual capital in generating and sustaining organizational competitive advantage (Bontis, 2000;); is generally conceptualized as “intellectual material - knowledge, information, experience, core technique, intellectual property, and customer relationship that can be put to use to create wealth” (Stewart, 1997); a knowledge-based economy, characterized by a rapid expansion of knowledge-intensive industries creating and exploiting knowledge and information in all sectors of the economy (Nonaka and Takeuchi, 1995).

108 1997; Mouritsen, 1998; Allee, 2000; Marr et al. , 2003) and various research projects have been made to explore other related details of this subject such as ' Measuring and reporting intangibles to understand and improve innovation management ' (Meritum) then E*KNOW-NET (Petty and Guthrie, 2000), which are supported by the European Commission. The importance of intellectual capital is emphasised in the revolution in information technology and the information society, the rising importance of