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The purpose of this paper is to analyse, through a temporal lens and from a managerial perspective, the role played by intellectual capital (IC) and intellectual liabilities (ILs) “in practice” within the value creation and value destruction processes. In particular, this study is based on the following research question: to what extent are time and its attributes considered, measured, and discussed with reference to IC and ILs and their influence on financial capital (FC)? In order to achieve this purpose, the author has carried out a field study.

A field study method is adopted in order to understand IC and ILs “in action” from a temporal perspective.

This study highlights the relevance of time when IC and ILs are analysed from a dynamic perspective. In particular, the main findings are the following. First, it emerges that the time dimension of IC tends not to be measured due to the complexity of IC itself and to the lack of adequate accounting practices. Second, IC time is generally considered to be non-cyclical and random. Third, even if time is not measured, some companies talk about it and when this is done with regularity, time perceptions move from an individual sphere to a collective one and they become more and more reliable. Moreover, IC performance is perceived to be “distant” from FC performance: the succession of events and the time lags are difficult to define and quantify as the influence of IC on FC is mediated by several resources and events. Lastly, the value destruction process related to ILs tends to generate negative effects faster than the value creation one, especially with reference to the impacts of IC on FC.

The main limitations of this study are twofold. The first is related to the methodology adopted and the related risks that the results may be subject to both interviewee and interviewer bias and interpretation. The second is related to the fact that the constructs to be discussed were not proposed by the firms but by the author, in order to make the results comparable.

This study contributes to the literature on IC and ILs “in action” and “in practice”. Moreover, this study enriches the extant IC and ILs literature focusing on time, a variable that is generally assumed to be a natural unchangeable phenomenon that does not deserve attention. In particular, the findings highlight the different behaviours and perceptions that occur when IC and ILs are looked at through a temporal lens. Finally, this study pinpoints that value creation and value destruction processes seem to have different timings as it takes more time to create value than to destroy it.

In comparison to previous studies, this study does not focus on the positive and negative effects of IC separately, but combines the two issues, also comparing the value creation and the value destruction processes in order to offer a complete picture. Moreover, it adopts a temporal lens, which has been applied only with reference to IC but not to ILs as well. Finally, while the extant literature on ILs tends to investigate them from a theoretical perspective and adopting a static approach, this research investigates ILs empirically from a dynamic perspective.

The purpose of this study is to observe Intellectual Capital (IC) dynamics “in practice” through a temporal lens by considering IC as an on-going process, and thus taking into consideration its life cycle and how it changes over time.

A longitudinal case study has been investigated by adopting a participant observation approach to understand how the dynamics of IC are understood in practice.

This study spotlights three main conceptions of IC dynamics (value creation, IC activities and organizational change) which, although generally proposed in literature as separable concepts, do co-exist and interact, in practice as is reflected in the related managerial tools.

The main limitations of this study are twofold. The first is related to the methodology adopted and in particular, to the participant observation approach. The second is related to the specifics of the case study undertaken. This paper contributes to the literature on “Intellectual Capital in action” and “Intellectual Capital in practice” by enriching the understanding of IC dynamics.

By comparison to the extant literature in which the IC dynamics concepts are considered separately, this study combines the three different concepts and examines them in vivo, adopting a longitudinal perspective.

This paper has the ambition to enrich the extant research about the interplay between measuring intellectual capital (IC) and managing IC or, more precisely, about the production and consumption of IC measurements in practice. Stemming from these considerations, the purpose of this paper is to disentangle the production and consumption processes of IC measurements in practice.

This study is based on a longitudinal case study is analysed adopting an interventionist approach.

This study shows the peculiarities regarding the production and consumption of IC measurements, from several perspectives. In particular, it emerges that the reporting of IC can, in some specific contexts, lead to the non-use of IC measurements and to the disappearance of the measured object, IC. What is questionable is whether it is the loss of interest in the IC object that has led to the non-use of the IC measurements or if it is the non-consumption of the measurements and their qualities that has implied the disappearance of the measurement object. In addition, this study sheds a light on the fact that in an IC project the consumption of the measurements can occur not only at the end of the production process, but also (and may be especially) during the production process itself. This consumption can generate different effects such as the identification of new managerial objects, the establishment of new initiatives, the development of a deeper knowledge about how IC works or a change of the sense of some of the existing measurements. In all, the paper underlines the fact that how IC measurements are produced (the process followed and the “actors” involved) affects their actual consumption (or non-consumption).

This paper contributes to the extant literature regarding the production and consumption of IC measurements. Moreover, it contributes to the field of IC “in practice” as it highlights what happens when an IC measurement system is implemented. Finally, the research work can contribute both to the studies regarding IC as an accounting change and to the ones regarding IC as a tool that facilitates organizational change. From the first perspective, the paper highlights how the introduction of IC has fostered long-lasting changes in the management accounting system, albeit circumscribed to the local (departmental) level. From the second perspective, the paper shows how IC may allow the creation of new managerial objects, thus promoting possible new actions. The main limitations of this study are related to the methodology adopted and to its specific pros and cons.

In comparison to previous studies, this one does not focus only on the managerial and organizational aspects related to the design and implementation of IC measurements or on their actual use, but attempts to approach them simultaneously adopting a longitudinal view. Moreover, this study does not adopt a theoretical perspective on how the indicators are designed and consumed but is aimed at investigating how these indicators are produced and consumed “in practice”. Finally, this study focus on the interplay between production and consumption of indicators, i.e. on the use of IC measurements in relation to the peculiarities of their production process.

This paper helps to address the need for investigations on intellectual liabilities (ILs). In light of these considerations, the purpose of this paper is to present an analysis of the extant literature on ILs in order to offer a solid base for improving the intellectual capital (IC) research agenda.

This study proposes a descriptive review. Refereed published studies and seminal works were analysed and then systematised.

This study shows that ILs tend to be overlooked in the IC discourse and identifies two main conceptions of ILs and the related measurement methods and tools. Furthermore, this study underlines the need to focus not only on what ILs are, but also on what ILs do. Finally, it supports the idea of adopting a holistic approach that considers both the positive (related to resources) and the negative (referred to liabilities) sides of IC.

The inability to cover all the literature that directly or indirectly deals with ILs is the main limitation of this paper. Time restrictions, language constraints and imperfect information narrow the coverage. Nevertheless, the adopted research methodology has allowed the authors to collect the main contributions in this field, in order to offer a concise, but complete picture of the studies on ILs.

This paper can be of help to those interested in analysing ILs, as it aims to systematise and offer a concise overview of the current literature in this field, which should be of use to both researchers and practitioners. Moreover, it offers some reflections on the topic and identifies possible research paths useful to developing future studies of theoretical and practical relevance.

This review differs from the previous ones dedicated to the IC discourse in two main ways: first, it does not focus on the whole of IC or on parts of it but on a specific topic, such as ILs, usually left out of the analyses and never adequately considered in previous literature reviews; second, it includes the publications on IC from 1999 to date and some unpublished works, in order to have both seminal and more consolidated studies.

The aim of this paper is to help to address the need for empirical investigations on intellectual capital and intellectual liabilities “in action” and their consequences in terms of value creation and value destruction. In light of this consideration, this study aims to investigate if and how intellectual capital and intellectual liabilities influence the value creation and destruction processes, that is, if intellectual liabilities “in action” simply mirror intellectual capital dynamics or if they present some specificities.

A multiple case study method is adopted in order to understand intellectual capital and intellectual liabilities “in action”.

This study highlights the relevance of intellectual liabilities within the intellectual capital discourse. In particular, it shows that intellectual capital and intellectual liabilities affect the value creation process in different ways. Moreover, it emerges that intellectual liabilities tend to be left out of managerial discussions. Stemming from this, the idea of intellectual equity is proposed and conceived as the logical difference between intellectual capital and intellectual liabilities.

The main limitations of this study are twofold. The first is related to the methodology adopted and in particular to the qualitative mapping process developed. The second is the fact that the constructs to analyse were not indicated by the firms but by the author in order to make the results comparable.

This study contributes to the development of the literature on “intellectual capital in action” and “intellectual capital in practice” bringing in the idea of intellectual liabilities and the consideration that intellectual capital can create, but also destroy, value. Moreover, it highlights the need to monitor and manage intellectual liabilities in order to control the negative effects generated by intellectual capital. Therefore, this analysis has both theoretical and practical implications.

In comparison to the extant literature mentioned, this study does not analyse IC only in terms of value creation, but also in terms of value destruction. Moreover, instead of proposing and developing new concepts, methods and tools, this research investigates intellectual liabilities “in action”. In addition, this work jointly considers value creation and value destruction processes.

The purpose of this paper is to investigate how organizations make sense of and give sense to intellectual capital (IC) measurements, i.e. to analyse the sensemaking, sensegiving, and sensebreaking processes with reference to IC measurements. In order to achieve this aim, a case study, developed adopting an action research approach, will be presented.

This study is based on a case study for which an interventionist research method was adopted.

The main findings are the following. First, the development of an IC project requires the development of an intense sensemaking and sensegiving activity as the managers of an organization need, first, to make sense of this new object (i.e. assign it a meaning) and of the consequent new managerial practices and, second, to diffuse the sense of IC and of its measurements within the organization. Second, the development of an IC project can be seen as a series of different types of sensemaking micro-processes (guided, fragmented, restricted, etc.) and each of them can lead to a different outcome of the practice of measuring IC; thus, it seems possible to argue that the outcome of the project depends on the specific type of sensemaking/sensegiving adopted in each phase (e.g. lock-in, mobilization, etc.). Third, it emerges that IC can be a sensebreaking device, i.e. existing measurements introduced in an “IC box” can acquire different meanings. Finally this study underlines the relevance of the “leaders” within the development of IC sensemaking processes and the related outcomes.

The main limitations of this study are twofold. The first is related to the methodology adopted and to its specific pros and cons. The second is related to the specificities (size, managerial approach, etc.) of the case examined. This paper contributes to the extant literature regarding the production and use of IC measurements “in practice” as it highlights what happens when an IC measurement system is implemented. Moreover it contributes to the development of a “theory of indicators” as it suggests aspects regarding how IC indicators are interpreted. Finally, the paper adds to the growing stream of analysis dedicated to the micro-processes of sensegiving and other sensemaking patterns, i.e. to the studies focused on how measurements are “shaped” “through the creative oral intertwining of accounting and other organizational knowledge”.

Differently from the extant literature, this study does not adopt a theoretical perspective on how measurements are designed and used but is aimed at investigating how these measurements are designed and used “in practice”. Moreover, this study analyses the use of IC measurements focusing specifically on the micro-processes of sensemaking, sensegiving, and sensebreaking that tend to be overlooked. In other words, this study examines sensemaking processes related to IC measurements, i.e. the sensemaking of IC measurements and by means of IC measurements. Finally, this investigation considers the different types of sensemaking processes in order to interpret the different outcomes of measuring IC.

The aim of this study is to reflect on how the specific nature of intellectual capital influences the valuation process, in practice, and how it impacts on some of the qualities of its value.

This study is based on a case study (“Ankon”) developed by adopting a modest interventionist approach.

This study highlights the relevance of the intellectual capital valuation process in spite of the intellectual capital value per se. In fact, while intellectual capital value seems to present a limited level of objectivity, consistency, comparability and understandability, its valuation process can be considered an opportunity to visualise and understand intellectual capital and its influence on financial performance. In other words, intellectual capital valuation can be considered as a practice useful to crave the attention of the managers on intellectual capital in action.

The main limitations of this study are related to the particular research methodology adopted (action research case study) and to the size of the case investigated.

The findings provided by this research should be useful to those interested in studying intellectual capital in action and in developing new valuation models or refining existing models. Finally, considering that some of the limitations of intellectual capital value can be related to the absence of generally accepted valuation guidelines (e.g. the absence of a common definition, a single process, etc.), this can represent an incentive for policy makers to draw up useful rules to make intellectual capital value more understandable for an outsider and to identify managerial best practices.

In comparison with previous studies on intellectual capital valuation, this one focuses on an in vivo intellectual capital valuation process. In addition, this research stresses the specificities and criticalities that emerge from a process perspective in which intellectual capital is considered as a conventional object. Moreover, this paper enriches the previous critical discussions on intellectual capital measurement focusing on intellectual capital financial value.

The purpose of this paper is to identify a definition of goodwill related to how companies describe their purchased goodwill. It focuses on whether there is any consistency in how firms define goodwill in practice in the first year of mandatory application of International Financial Reporting Standards 3 (IFRS3).

The paper builds on an analysis of how companies describe goodwill in purchase analyses related to company acquisitions. The empirical body of this study is represented by the financial statements of Italian and Swedish listed companies.

The overall finding of this investigation is that, in practice, the concept of goodwill is unclear and therefore there is no reference to one singular definition of goodwill. Moreover, in spite of the idea underlying IFRS3, goodwill still appears to be a “black box”, wherefore an accounting inertia is highlighted.

The main limitation of this study is that only a sample of firms (those listed on the Stockholm Stock Exchange and the Milan Stock Exchange) that apply IFRS3 is investigated. The main implication of this paper is that it is possible to identify some general classes of descriptions, but these remain vague. Therefore, some accounting policy suggestions are proposed.

First, this paper focuses on a definition communicated by firms, which is different from most other studies, as they tend to focus on a theoretical definition of goodwill. Second, this paper focuses on a goodwill definition in practice, whereas studies of goodwill practice mainly concern impairment testing.

The purpose of this paper is to contribute to the understanding of intellectual capital (IC) by adopting a temporal lens and emphasizing the role time plays in IC analysis.

An action research case study (Alpha) related to a joint venture development process is conducted.

IC is a complex and dynamic system which can be observed from several different perspectives, not only according to the point of view adopted by the observer, but also according to the moment in which IC is being observed. Thus, the time factor must also be considered in the whole IC issue.

The limitations of this study are related to the particular research methodology adopted (action research). The main implication of this paper is that the temporal context and the time dimension have to be considered as variables in IC analysis. How to explicitly consider time in the IC question represents future research opportunities.

First, the paper applies, in the accounting field, a research lens that is mainly used in organizational studies. Second, it stresses the role played by time in IC, a factor that authors tend to underestimate in their studies.

The aim of this paper is to understand how many and what intangible assets firms from two different contexts disclose in order to comprehend whether an accounting harmonization is actually reached in practice and what are the eventual hurdles to surmount in order to reach it.

A qualitative and quantitative analysis of the purchase analyses disclosed by the Swedish and Italian listed companies in their financial statements refering to the first year of application of the IFRS3 is conducted.

The main findings are the following. First, firms do not disclose intangible assets in the same way. Second, contracts become a useful tool to make it possible to account for IC. Third, the disclosure of labels shows a variety. Fourth, differences in behavior are seen.

The main limitation is that only a sample of firms (the listed ones in the SSE and MTA/MTAX) that apply IFRS3 is investigated. The main implication is that the disclosing of IC in financial statements is problematic and makes harmonization difficult to achieve. The empirical deepening of these two conclusions represents opportunities for future researchers.

The research is an investigation of the first year of application of a new accounting principle from an inter‐country comparison considering it as an opportunity to disclose more IC and consequently to contribute to the debate about how and what IC should be disclosed.