Improving Competitiveness using Intellectual Capital

Abstract

Intellectual Capital provides more value for the institution thereby increasing competitiveness. This becomes an interesting topic to discuss and to research. Therefore, it should be realized by the managers or top management that the training programs to improve employee competency needs to be improved; whether by types, quantity or its quality; rather than just buying property for business expansion and new others tangible assets. Based on the research from experts proves that institution that have a more intellectual capital than its competitors the institution would have been much more profitable, as well as financial performance and firm value better. Viewed from the standpoint of accounting, disclosure of intellectual capital can be seen from the financial reporting of the institusi through good training programs and human resource spending can increase employee competency, so that the impact effect on increasing Free Cash Flow (FCF).

Keywords: intellectual capital, competitiveness, financial reporting, FCF