Abstract

Purpose: This study investigates the influence of intellectual capital (IC) on firms

both financial and market performance as well as its impact on the financial reporting

quality (FRQ).

Design /Methodology /Approach: The study uses a sample of 52 listed

companies on the Egyptian stock market covering the period from 2014 to 2019. The

study applies the modified value-added intellectual coefficient (MVAIC) to measure

the efficiency of the IC. Eventually, the study tests the hypotheses through multiple

regression analysis and panel data.

Findings: The study reveals that the MVAIC significantly influences the financial

performance as well as the market performance. The study also shows a significant

impact of the MVAIC on the FRQ.

Research Limitations: The main limitation of the study comes from the inability

of the researcher to tackle the separate impact of each component of the intellectual

capital efficiency and the limited sample size due to the inconsistent disclosure of

the needed data.

Practical implications: The findings of the study may help stakeholders, and

managers in managing their IC resources efficiently, and effectively.

Originality/Value: This study develops the prior studies by giving prospects for

companies on developing their IC. The current study is the first study

to encouraging examine the impact

of the IC On FRQ among the Egyptian listed firms using the

MVAIC

Key words: Intellectual capital, financial performance, market performance

financial reporting quality.

Paper type: Research paper