CAPITALIZATION RATE, INTERNALLY GENERATED INTANGIBLE ASSETS, AND THE VALUE RELEVANCE OF ACCOUNTING INFORMATION: EVIDENCE FROM INDONESIA

The purpose of this study is to examine the effect of internally generated intangible assets’ capitalization rate at the firm level on the value relevance of accounting information. Capitalization rate is defined as the tendency of a firm to capitalize their expenditures that may have future benefit...

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Autores principales:	Widyatama W.W., Wirama D.G.
Formato:	article
Lenguaje:	EN RU
Publicado:	Russian Journal of Agricultural and Socio-Economic Sciences 2021
Materias:	capitalization rate internally generated intangible assets value relevance timeliness negative earnings presence firm size Agriculture (General) S1-972
Acceso en línea:	https://doaj.org/article/90f7b23ea9ae491e8cf8bf8d22217769
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spelling	oai:doaj.org-article:90f7b23ea9ae491e8cf8bf8d222177692021-12-04T10:58:05ZCAPITALIZATION RATE, INTERNALLY GENERATED INTANGIBLE ASSETS, AND THE VALUE RELEVANCE OF ACCOUNTING INFORMATION: EVIDENCE FROM INDONESIA10.18551/rjoas.2021-11.142226-1184https://doaj.org/article/90f7b23ea9ae491e8cf8bf8d222177692021-11-01T00:00:00Zhttps://doaj.org/toc/2226-1184The purpose of this study is to examine the effect of internally generated intangible assets’ capitalization rate at the firm level on the value relevance of accounting information. Capitalization rate is defined as the tendency of a firm to capitalize their expenditures that may have future benefit for the firm. In accordance with the matching concept, expenditures that may have future benefit for the firm should be capitalized to provide more accurate information to investors related to the financial performance of the firm. Thus, it is hypothesized in this study that a greater capitalization rate for the internally generated intangible asset improves the value relevance of accounting information. Timeliness of publication and negative earnings presence were included as the controlling variables. 31 firms were selected through the purposive sampling method. The data collected are secondary data and the data analysis technique utilized was the multilple linear regression analysis. However, the analysis results showed that capitalization rate does not have a significant effect on the value relevance of accounting information with timeliness and negative earnings presence as the controlling variables. After the inclusion of firms that do not use Indonesian Rupiah as their reporting currency, the total sample only increased by 2, with a total of 33 firms. Despite this inclusion, the hypothesis was still rejected. The data also shows that most firms provide inadequate information regarding their intangible assets.Widyatama W.W.Wirama D.G.Russian Journal of Agricultural and Socio-Economic Sciencesarticlecapitalization rateinternally generated intangible assetsvalue relevancetimelinessnegative earnings presencefirm sizeAgriculture (General)S1-972ENRURussian Journal of Agricultural and Socio-Economic Sciences, Vol 119, Iss 11, Pp 119-128 (2021)
institution	DOAJ
collection	DOAJ
language	EN RU
topic	capitalization rate internally generated intangible assets value relevance timeliness negative earnings presence firm size Agriculture (General) S1-972
spellingShingle	capitalization rate internally generated intangible assets value relevance timeliness negative earnings presence firm size Agriculture (General) S1-972 Widyatama W.W. Wirama D.G. CAPITALIZATION RATE, INTERNALLY GENERATED INTANGIBLE ASSETS, AND THE VALUE RELEVANCE OF ACCOUNTING INFORMATION: EVIDENCE FROM INDONESIA
description	The purpose of this study is to examine the effect of internally generated intangible assets’ capitalization rate at the firm level on the value relevance of accounting information. Capitalization rate is defined as the tendency of a firm to capitalize their expenditures that may have future benefit for the firm. In accordance with the matching concept, expenditures that may have future benefit for the firm should be capitalized to provide more accurate information to investors related to the financial performance of the firm. Thus, it is hypothesized in this study that a greater capitalization rate for the internally generated intangible asset improves the value relevance of accounting information. Timeliness of publication and negative earnings presence were included as the controlling variables. 31 firms were selected through the purposive sampling method. The data collected are secondary data and the data analysis technique utilized was the multilple linear regression analysis. However, the analysis results showed that capitalization rate does not have a significant effect on the value relevance of accounting information with timeliness and negative earnings presence as the controlling variables. After the inclusion of firms that do not use Indonesian Rupiah as their reporting currency, the total sample only increased by 2, with a total of 33 firms. Despite this inclusion, the hypothesis was still rejected. The data also shows that most firms provide inadequate information regarding their intangible assets.
format	article
author	Widyatama W.W. Wirama D.G.
author_facet	Widyatama W.W. Wirama D.G.
author_sort	Widyatama W.W.
title	CAPITALIZATION RATE, INTERNALLY GENERATED INTANGIBLE ASSETS, AND THE VALUE RELEVANCE OF ACCOUNTING INFORMATION: EVIDENCE FROM INDONESIA
title_short	CAPITALIZATION RATE, INTERNALLY GENERATED INTANGIBLE ASSETS, AND THE VALUE RELEVANCE OF ACCOUNTING INFORMATION: EVIDENCE FROM INDONESIA
title_full	CAPITALIZATION RATE, INTERNALLY GENERATED INTANGIBLE ASSETS, AND THE VALUE RELEVANCE OF ACCOUNTING INFORMATION: EVIDENCE FROM INDONESIA
title_fullStr	CAPITALIZATION RATE, INTERNALLY GENERATED INTANGIBLE ASSETS, AND THE VALUE RELEVANCE OF ACCOUNTING INFORMATION: EVIDENCE FROM INDONESIA
title_full_unstemmed	CAPITALIZATION RATE, INTERNALLY GENERATED INTANGIBLE ASSETS, AND THE VALUE RELEVANCE OF ACCOUNTING INFORMATION: EVIDENCE FROM INDONESIA
title_sort	capitalization rate, internally generated intangible assets, and the value relevance of accounting information: evidence from indonesia
publisher	Russian Journal of Agricultural and Socio-Economic Sciences
publishDate	2021
url	https://doaj.org/article/90f7b23ea9ae491e8cf8bf8d22217769
work_keys_str_mv	AT widyatamaww capitalizationrateinternallygeneratedintangibleassetsandthevaluerelevanceofaccountinginformationevidencefromindonesia AT wiramadg capitalizationrateinternallygeneratedintangibleassetsandthevaluerelevanceofaccountinginformationevidencefromindonesia
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CAPITALIZATION RATE, INTERNALLY GENERATED INTANGIBLE ASSETS, AND THE VALUE RELEVANCE OF ACCOUNTING INFORMATION: EVIDENCE FROM INDONESIA

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