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This paper aims to investigate if the more stringent requirements of AASB 138, effective 1 January 2005, regarding capitalising research and development (R&D) spending could have been a catalyst for changes in managerial decisions that consequently resulted in reduced R&D spending in Australian companies.

Financial data of 31 Australian listed firms for financial years from 2001 to 2010 were used. Companies were classified as either capitalisers or non-capitalisers. A regression model was used to ascertain whether managers reduced R&D spending to manage earnings to attain short-term goals. Also, the research intensity ratios were calculated to determine trends in R&D spending of the two groups.

The pursuit of choosing short-term earnings targets to the detriment of long-term returns is referred to as short-termism. This study found a marked increase in the significance of short-termism in explaining changes in R&D of capitalisers before 2005. Furthermore, the median research intensity ratio of capitalisers declined almost three times that of non-capitalisers after the introduction of AASB 138. These findings suggest that AASB 138 could have been a catalyst for changes in managerial decisions in pursuit of short-termism, resulting in reduced R&D spending as a means to manage earnings.

This study is useful to standard setters and board of directors as it alerts them about the potential adverse effect AASB 138 might have on the survivability and competitiveness of Australian companies and hence the Australian economy.

This paper aims to explore how advanced integrated report preparers internalise and operationalise material value creation information to manage the generation of such information for the integrated report.

The paper adopts a qualitative approach using in-depth semi-structured interviews to examine how information about material value creation matters in six South African organisations are managed.

The findings will be useful to integrated reporting adopters as to how they might implement appropriate processes and systems to determine, communicate, collect and process information about matters that substantively affect their value creation.

The paper contributes to the body of knowledge by providing insight on how material value creation matters are determined, communicated internally and information about such matters generated.

The purpose of this paper is to develop guidelines of what award winning companies, leading practice in integrated reporting (IR) disclose in their integrated reports about material issues and their materiality determination processes. Also, to provide insight into what they disclose about their perception of materiality.

A content analysis was conducted to investigate what the top 10 South African companies of the 2015 Ernst and Young Excellence in Integrated Reporting Awards disclosed in their 2014 and 2015 integrated reports about their materiality determination processes, material issues and what materiality means to them. Thematic analyses were conducted in developing guidelines.

All except one company applied the International Integrated Reporting Framework. The materiality determination processes, material issues and companies’ descriptions of materiality are diverse. Material issues most companies identified relate to employees, social and environmental issues, customers and sustainable performance.

The proposed guidelines will provide useful strategies for organisations embarking on the IR journey about what issues could be considered as material and therefore included in integrated reports. It also proposes activities companies can undertake to identify, evaluate and prioritise material issues and execute their materiality determination process.

This paper is the first to develop guidelines of material matters and materiality determination processes. It also adds to existing literature on IR practice and the application of materiality.

This study aims to explore farmers’ perceptions of environmental impacts of dairying and their practices towards implementing environmental management accounting (EMA) techniques.

Semi-structured interviews were held with five dairy farmers in the South Island of New Zealand (NZ).

Dairy farmers perceive environmental sustainability in dairying as being able to feed people while protecting the environment so that future generations can also enjoy the natural world. Recognising the need to alter their practices to reduce environmental damage they have produced, dairy farmers use some EMA techniques, but the primary motivation is compliance with government regulations. Other motivations for using EMA techniques are high economic returns, maintaining their reputation and self-satisfaction. Barriers to implementing EMA techniques are primarily due to lack of clarity and feasibility of regulations, coercion and inadequate communication by regulators and high compliance costs.

The findings contribute to the current EMA literature by providing a better understanding of EMA practices of dairy farmers in NZ, barriers to implementing EMA and how those barriers could be reduced. It may also help NZ central and local government in developing environmental strategies and policies. Furthermore, this research is expected to help people in the dairy industry to find ways to educate farmers about how the measures that are required can help them to reduce both the environmental impacts and the costs of dairying, thus contributing to sustainable development globally.

This paper seeks to examine the extent to which pictures are used to communicate intellectual capital (IC) information and the changes in volume of IC disclosure when pictures are included.

A content analysis was conducted to determine the impact that pictures have on IC reporting (ICR) results. In determining the extent to which pictures are used in corporate annual reports the paper compares frequencies of IC reported in pictures as proportions of: total IC reported, total pictures and total pages. A key assumption underlying content analysis is that the volume of disclosure signifies the importance of the item(s) being disclosed. The paper compares the volume of IC items disclosed with and without pictures to determine which items firms signal as being most important. Using these volumes the paper determines which of the sampled firms use pictures as a popular reporting mechanism to disclose their IC resources.

A significant portion (42 per cent) of ICR is made in picture form and the majority of pictures (66 per cent) communicate messages about IC resources. Therefore, the volumes of IC items disclosed change significantly when pictures are included. It is found that many firms use pictures to disclose their IC resources, particularly employees and brands which may indicate that these are their most important IC items.

A significant part of IC is reported in picture form in annual reports. Excluding pictures when analysing content in annual reports will result in ICR not being fully captured, a partial understanding of what IC is disclosed and misunderstanding of what IC items firms consider as being important.

The authors incorporate pictures into their content analysis. Pictures are not normally included in IC disclosure studies.

Companies use figures within the annual report to send messages. The purpose of this paper is to explore the opinions and understandings of annual report preparers who produce the figures and users who interpret them. The focus is on figures that the authors consider convey messages about the company's intellectual capital (IC).

The paper used a questionnaire to obtain the opinions of “informed investors” and conducted interviews with the preparers of the annual reports. It compared the opinions of the two respondent groups.

Preparers and users bring multiple meanings to the figures. Users overlooked some messages which were complex and symbolic and also perceived more messages than intended by the preparers. The two respondent groups generally perceived brands, corporate image building and aspects related to employees as the IC items best portrayed in the selected figures. Most users and some preparers perceived the main reason for using figures was their strength as a marketing tool.

The paper is exploratory in nature and there is scope to extend the work to a greater number of annual reports and/or figures. The research is limited by the use of students as a proxy for users of annual reports.

The findings may be helpful to annual report preparers in understanding the rhetorical impact of images. Such understanding will help them in choosing figures which are effective and persuasive when seeking user engagement.

The authors are not aware of any prior research that examines the perceptions of preparers and users in respect of messages conveyed through figures, and, in particular, research that incorporates aspects of IC in corporate annual report figures. The paper, therefore, extends the empirical literature on IC.

The purpose of this paper is to focus on small and medium enterprises (SMEs) in an attempt to cover the gap in research on intellectual capital (IC) applied to SMEs. The paper informs the debate on the importance of IC by providing empirical evidence of SME managers' perceptions about the importance and contribution of intangible assets to their businesses.

Questionnaires were sent to New Zealand SMEs investigating managers' perceptions about the importance of and the contributions that intangible asset components make to their businesses, and to assess their familiarity with the term intellectual capital (IC) and their preferences in using the term IC versus intangible assets. The results pertaining to the importance of intangible assets were statistically analysed.

This paper informs that the broad assumption that intangible assets are important and are value drivers of business' success is valid for small and medium enterprises. The majority of respondents perceive intangible asset components to be essential, very important and important to the success of their business and that these components collectively make several contributions to their businesses. Based on average rating, customer satisfaction ranked as the most important and thereafter customer loyalty, corporate reputation, product reputation and employee know‐how. A minority of respondents indicated that only a few components are not very important and not important at all, the least important component being distribution agreements, followed by employee education and relationships with investors. The majority of respondents are familiar with the term IC, and the same number prefer to use the term “intangible assets” as those preferring to use the term IC.

Providing evidence of SME managers' perceptions of the importance and contributions of intangible assets is essential to raise awareness among SME managers in understanding, identifying and managing intangible assets that are important value drivers for their businesses. Such awareness is essential in particular in countries where SMEs make up a significant proportion of business and employment. The results of this study may be a benchmark for SME managers unfamiliar and ignorant about the topic of this research.

This paper is the first providing empirical evidence as to SME managers' perceptions about the importance of and the contributions of intangible assets to their businesses, as well as about their familiarity with the IC concept and preference in using IC terminology.