THE WORTH OF DISCLOSURES IN THE VALUE ADDED STATEMENT AND PATTERN OF VALUE ADDED DISTRIBUTION

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2013-08-11

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DEPARTMENT OF ECONOMICS FACULTY OF SOCIAL SCIENCES NASARAWA STATE UNIVERSITY, KEFFI

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Quoted Nigerian companies are statutorily publishing the value added statement (VAS) along other financial reporting requirements. The issues this paper sets out to establish are the significance of value added reports, pattern of value added distribution and to examine whether the value added statement disclosures are useful in social reporting in Nigeria. Documentary data sources were extrapolated from annual financial reports and perception survey questionnaire was administered on report users and stakeholders. Value added ratios were identified and computed and simple correlation analyses were used to establish if they exists any relationship among the variables. The value added ratios are all positively correlated but negatively correlated with value of sales. Whereas the stakeholders found the value added statement to be reliable, complete and objective, it has been less relevant and less useful to stakeholders in their information need. The level of its utilization is low. Value added ratios need to be computed and reported as they improve on the information capacity of the VAS and will make it more attractive to user groups and stakeholders. VAS should be used to construct value added-based ratios, as important diagnostic and predictive tools for making comparison of company’s performance

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References Riahi-Belkaoui, A. (1999), Value Added Reporting and Research: State of the Art. Quorum Books, Westport, CT. Aborode, R. (2006). A Practical Approach to Advance Financial Accounting (2nd Ed.). Master Stroke, Lagos. Cox, B. (1979), Value Added: An Appreciation of the Accountants concerned with industry, Institute of Cost and Management Accountants, 1978, quoted in M.F. Morley’s ‘The Value Added Statement in Britain’, The Accounting Review, Vol. LIV, No. 3, July. Cruns, R.P. (1982), Added-Value: The Roots run Deep into Colonial and Early America, Accounting Historian Journal, fall. Evraert, S. And A. Riahi-Belkaoui (1988), Usefulness of Value Added Reporting: A review and Synthesis of the literature, managerial Finance, 24 (11). Sizer, J. (1994), An Insight into Management Accounting, Pitman Publishing Ltd, London. Morley, M.F. (1978), The Value Added Statement: A review of its uses in corporate Reports. The Institute of chartered Accountants of Scotland, London. Riahi-Belkaoui, A. (1996), Performance Results in Value Added Reporting, Quorum Books, Westport. Rutherford, B.A. (1980), Published Statements: A survey of Three Years’ Experience, Accounting and Business Review, Winter. Sinha, G. (1983), Value Added Income, Book World, Calcutta. Van Staden, C.J. (2000), Revisiting the Value Added Statement: To Publish or Not to Publish in Proceedings of the 12th Asian pacific Conference on International Accounting Issues, October.

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https://keffi.nsuk.edu.ng/handle/20.500.14448/6445

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