DYNAMIC RELATIONSHIP BETWEEN INTELLECTUAL CAPITAL AND COMPANY’S FINANCIAL PERFORMANCE

Abstract The purpose of this study was to determine the dynamic relationship between intellectual capital and company’s financial performance. This study used two independent variables. The two independent variables were VAICTM and ROGIC measured by using Pulic’s Model. The dependent variables was company’s financial performance measured by ROE and EPS. Moreover, population on this study consisted of all listed companies in Indonesia Stock Exchange during 2013. Companies in the financial sector were excluded from the study. However, the samples were 53 companies. These samples were chosen by purposive sampling criterions. Partial least square was used for analyzing the data. The result showed that VAICTM was positively related to company’s financial performance. In the future, VAICTM was also related to company’s financial performance, positively. However, in the future time, ROGIC was not significance toward financial performance. Keywords: Value Added Intellectual Coefficient, Rate of Growth of Intellectual Capital, Company’s Financial Performance, Partial Least Squar