Intellectual Capital Disclosures in Ipo Prospectuses of Selected Indian Companies

Abstract

The contemporary economic scenario has transformed the way the companies used to compete with each other. Earlier, the turnover and the financial valuation of a company were used as a yardstick to judge its capabilities and it was assumed that higher amount of profits and assets is indicative of higher competitive advantage to the company. So, the disclosure of profits, physical assets and various types of ratios to the stakeholders were supposed to be sufficient to show the financial strength of the company. Today, the factors like experienced and skillful employees, good relationships with stakeholders, corporate culture, RandD and technological advancements give a competitive advantage to the organizations. Disclosure of such resources i.e. intellectual capital along with physical assets related information helps the organization to enhance its reputation, market valuation and the ability to raise capital. newline