Content analysis within intangible assets disclosure: a structured literature review
| Pages | 506-543 |
| Published date | 10 July 2017 |
| Date | 10 July 2017 |
| DOI | https://doi.org/10.1108/JIC-11-2016-0123 |
| Author | Francisca Castilla-Polo,Consuelo Ruiz-Rodríguez |
| Subject Matter | Information & knowledge management,Knowledge management,HR & organizational behaviour,Organizational structure/dynamics,Accounting & Finance,Accounting/accountancy,Behavioural accounting |
Content analysis within intangible
assets disclosure: a structured
literature review
Francisca Castilla-Polo
Department of Financial Economy and Accounting,
University of Jaén, Jaén, Spain, and
Consuelo Ruiz-Rodríguez
Universidad de Jaén, Jaén, Spain
Abstract
Purpose –In this paper, the authors analyze the use of content analysis in disclosing voluntarily information
on intangible assets, the intangible assets disclosures (IAD). The purpose of this paper is to conduct a
structured literature review (SLR) that assesses the possibilities and limitations of content analysis.
Design/methodology/approach –To that end, the authors analyze the existing literature on the topic in
the main international databases. In all, 74 empirical articles utilizing content analysis as a research
methodology for IAD were reviewed. Regarding the selection of sources, the authors should indicate that the
SLR performed includes academic studies published in journals or presented at conferences and that are
always subject to a double process of anonymous review.
Findings –The obtained results indicate that despite the frequent use of content analysis in studies on
IAD, its use does not meet all expectations.
Research limitations/implications –The study synthesizes the research on content analysis for the
case of information on intangible assets, offering an updated and global framework for future researchers
through the SLR.
Practical implications –Among other problems, the authors found its excessive emphasis on the amount
disclosed in the annual report, ignoring other reports in which more information regarding intangible assets is
available, such as in the case of the sustainability reports. Furthermore, the use of very different coding
systems and its exclusive use without being combined with other methodologies are detected. These aspects
affect the quality problems of the sources used, which directly results in the utility of the evidenced findings.
Social implications –These conclusions allow the authors to conclude on the need to open differentlines of
study that review the use of content analysis in this topic.
Originality/value –The work focuses on the quality of disclosures more so than on the quantity, offering a
critical view that summarizes the utility of the employment of content analysis for this type of disclosure and
its implications for future research on this topic. Despite previous studies, the authors highlight the new
insights revealed from IAD research, especially since the seminal paper of Dumay and Cai (2014).
Keywords Content analysis, Intellectual capital reporting, Voluntary disclosures, Intangible assets,
Structured literature review
Paper type Literature review
1. Introduction
Intangible assets –for example, an organization’s ability to innovate and launch new
products and services in the market, its reputation and image, its ability to establish a stable
relationship with clients and suppliers, or its employee motivation –are currently
considered key to achieving business success. Indeed, authors such as Hsu and Fang (2009),
Kong (2010), Martín et al. (2011), Abhayawansa and Guthrie (2014) and Singh and Narwal
(2015) argue that these assets, grouped under the concept of intellectual capital, are crucial
factors for achieving long-term organizational benefits.
The interest in intangible assets dates over a decade, when numerous researchers
focused on analyzing the importance of making investments alternative to those made in
tangible assets and the corresponding expectation of higher yields for those who possess
immaterial character. The contributions of Lev (2001), Keong (2008), Kong (2010) and
Journal of Intellectual Capital
Vol. 18 No. 3, 2017
pp. 506-543
© Emerald PublishingLimited
1469-1930
DOI 10.1108/JIC-11-2016-0123
The current issue and full text archive of this journal is available on Emerald Insight at:
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Giustina et al. (2010), among others, warrant special mention. These studies emphasize the
main characteristics of intangible assets when explaining their value: the possibility of
simultaneous uses, the fact that they are irreplaceable and the difficulty of replicating them
because they are specific to organizations. Therefore, it is unsurprising that the relevance of
intangibles is leading companies to develop their capacity to identify, measure and manage
them; this is generically referred to as intangible management (Sánchez et al., 2000;
Stanfield, 2002). In this study, the role of information is key because it is the essential tool for
the implementation of intangible management. Thus, following Norton and Kaplan (1996)
and Stewart (1997), and specifically regarding the application of information to the field of
intangible assets, Sveiby (2001) among others, it is widely recognized that one cannot
manage what one cannot measure.
Despite promising news that motivated radical changes, accounting information systems
have conceded their inability to reflect the value of investments in intangible assets over
time (Cañibano and Sánchez, 2004; Wyatt, 2005; Cañibano et al., 2009; Organization for
Cooperation and Economic Development (OECD), 2012). Further, the importance is growing
of information contained outside of traditional financial statements, which, according to
KMPG (2016) in “The KMPG Survey of Business Reporting,”allows businesses to provide a
more complete perspective on their ability to grow or maintain their revenue level. These
two facts are leading organizations to consider the voluntary disclosure of information that
is not reflected in their balance sheets. According to the KMPG report, we note that although
these types of disclosures increased during the five years analyzed (3 percent), they still fall
short in the attempt to align their objectives with the ability to create value rather than with
an explanation of financial data (KMPG, 2016).
In our study, the terms intangible assets and intellectual capital are employed as
synonyms based on the definitions proposed by the vast majority of research in this field
(Cuozzo et al., 2017), i.e., assets not recognized by accounting systems but capable of
generating future profits (Lev, 2001). However, the term intangible asset is used individually
beyond the connotation of intellectual capital to represent an aggregate of all assets with
this character present in a company. Hence, we have opted for the term intangible assets to
capture for the possibility that the company only reveals a part of its intellectual capital.
Similarly, Giacosa et al. (2017, p. 150), following Dumay (2016), indicate that the acronyms
intangible assets reporting and intangible assets disclosures (IAD) are different in that the
first denotes the idea of “the revelation of information that was previously secret or
unknown”as opposed to the “detailed periodic account of company’s activities, financial
condition and prospects that is made available to shareholders and investors.”
Thus, the term intangible assets disclosures (IAD) will be used in this study to
investigate the information published regarding these assets with an emphasis on the notion
of voluntary disclosure, that is, they are assets whose disclosure is not required by
mandatory accounting regulations such as IAS 38 Intangible Assets (International
Accounting Standards Board, 2004) or SFAS 142 Goodwill and Other Intangible Assets
(Financial Accounting Standards Board, 2001).
The classical literature on voluntary disclosure originates with Grossman (1981) and
Milgrom (1981), who argue that organizations tend to disclose non-obligatory information in
an attempt to satisfy the demands of stakeholders and to achieve a competitive position in
the market, implying a prior cost-benefit analysis associated with such activity (Depoers,
2000). We can identify three possible approaches among the main disclosure strategies
adopted by businesses. First, there is the full disclosure of information in ideal conditions
(Akerlof, 1970; Milgrom, 1981, among others), allowing maximum transparency, good
relationships with investors, and a low cost of capital. Nonetheless, this approach also
produces disadvantages such as information overload and the loss of competitive
advantage. A second strategy is the partial disclosure of company information, allowing
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selectivity in the choice of information and avoiding disclosure costs but resulting in
increases in the cost of capital and the possibility of losing competitive advantage in the
market (Elliot and Jacobson, 1994). Finally, it is important to note that the absence of
voluntary disclosure represents a third approach, where the company provides only the
information required by law and protects its competitive advantage. However, non-
disclosure may raise the cost of capital and create a poor reputation in the market, resulting
in the possible reaction of competitors (King and Wallin, 1995).
We must note that the literature on intangible assets and its voluntary disclosure by
companies has developed considerably in recent years. The maturity of the research
conducted on intangible assets thus leads us to move beyond addressing its mere potential,
as would be expected with respect to an emerging research topic (Petty and Guthrie, 2000),
to further detect possible issues with regard to generalizing the conclusions obtained.
Specifically, our study analyzes whether the use of content analysis has reached its full
potential when applied to studying IAD over the last 17 years. These years correspond to
the boom and development of this research topic (Guthrie et al., 2012; Edvinsson, 2013).
Content analysis has been widely used to comparatively measure IAD and the trends in
this type of voluntary disclosure (Guthrie et al., 2004). For this reason, we conduct an in-
depth study of its strengths and weaknesses to critically evaluate its usefulness for the
analysis of IAD.
Considering previous studies, our paper highlights the main insights revealed by the
use of content analysis in IAD from 2000 to the present. Taking into account
the milestones established by the seminal papers of Guthrie et al. (2004), Abeysekera
(2006), Dumay and Cai (2014, 2015) and Goebel (2015), our study is the most up-to-date
review on content analysis and IAD.
Guthrie et al. (2004) review the role of content analysis in social and environmental
disclosure and refer to the case of intangible assets as a future line of study that will
require further refinement and development by researchers in this field. Abeysekera
(2006) criticizes the use of different coding frameworks in IAD and the problems stemming
from the incomparability of the results obtained. Beattie and Thomson (2007) note the
drawbacks stemming from the definition of intellectual capital and the implications that
this entails for the interpretation of the results obtained via this methodology. Dumay and
Cai (2014) observe an unpromising future and challenge researchers to be innovative in
the application of content analysis. They identify three fundamental problems:
the subjectivity of disclosures, their unit of analysis and their weighting/quality.
Taking a more methodological approach, Dumay and Cai (2015) do not find a generally
accepted approach for developing research questions and hypotheses, and they
recommend taking as a starting point the postulates of Krippendorff (2013) and
ensuring that the logic of their designs is strictly adhered to. Finally, Goebel (2015) focuses
on the problem of comparability posed by Dumay and Cai (2014), finding that it is possible
to achieve this requirement using previous research.
Compared with a classical or traditional review, the structured literature review (SLR)
“is a method for studying a corpus of scholarly literature, to develop insights, critical
reflections, future research paths and research questions”(Massaro et al., 2016, p. 2), hence
its usefulness in this area. The SLR has already been used in areas similar to intangibles,
such as integrated information (Dumay et al., 2016), but only recently for the subject that
concerns us (Cuozzo et al., 2017).
Our study contributes to the research in two ways.
First, it synthesizes the research on content analysis in the case of information on
intangible assets voluntarily disclosed by companies, offering a global analytical framework
for future researchers via the SLR. Although there are important review studies on IAD,
there are few studies that address content analysis exclusively. Hence, we restricted our
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