RELEVANCE OF INTANGIBLE ASSET ACCOUNTING RECOGNITION AND FIRM VALUE OF LISTED BREWERY COMPANIES IN NIGERIA

Abstract

Firm value is generally seen as the worth of a company given the total value of outstanding shares in the market. It enables the stakeholders to determine the share price which reflects the success of the firm with respect to investors’ commitment. The basic problem of firm value to the firm is the conflict of interest arising from the agency problem which influences the share price adversely. In order to emphasize the conflicting results in the literature, the empirical review examines earlier research works on intangible asset accounting recognition and firm value. The objective of the study is to examine the influence of investment in research and development recognition, intangible asset accounting recognition and relevance of goodwill recognition on firm value of listed brewery companies. The study adopts the use of expo-facto research design while the population consists of all listed brewery companies in the Nigerian Stock Group (NGX) for the period of 2013- 2022. Purposive sampling technique in collaboration with filtering method is applied to sample 4 companies while the secondary data is extracted from the annual reports of the sample companies listed on the NGX, and Generalized Linear Model Regression technique is employed to analysis the data. The results reveal that investment in research and development recognition has a significant influence on firm value with z-test value of 4.39 and p-value of 0.00 (<0.05) at 1% level of significance while intangible asset accounting recognition has no significantly influence on firm value with z-test value of -0.28 and p-value of 0.77 (>0.05) and relevance of goodwill recognition has no significantly influence on firm value with z-test value of -0.83 and p-value of 0.40 (>0.05). The study concludes that the investment in research and development recognition creates value for the shareholders of listed brewery companies in Nigeria, and it recommends recommended that corporate investors of brewery companies in Nigeria should commit more investment in research and development for positive wealth maximization from through increase in market value of share.