Intellectual Capital: ISVA, the Alternative Way of Calculating Creating Value in Agricultural Entities—Case of Poland

In the knowledge-based economy, knowledge is regarded as a strategic resource that helps entities to become market leaders. This strategy has been successfully used for years by companies operating in various sectors of the economy. The exception, however, is agriculture, which has been seen for years as a sector with low knowledge intensity and is one that is skeptical about the possibility of using knowledge. This is important especially in that the use of it is, for many managers, still unconscious, and, therefore, this factor remains unused in practice. This paper describes the Intellectual Sources of Value Added (ISVA), an alternative method for analyzing the productivity of tangible and intangible inputs affecting the value-adding process in agricultural holdings. The reasons for developing the concept of that indicator were the imperfections found in the Value-Added Intellectual Coefficient (VAIC™), a widely adopted method authored by A. Pulić. However, the index of efficiency of intellectual capital (VAIC), recognized as suitable for research purposes, demonstrates certain methodological imperfections, including the simultaneous use of resource- and flow-based values. In addition to certain relevant reservations, the above has other consequences, including the declining trend followed by the efficiency of working capital calculated using this formula. In a situation where working capital is observed to grow, this would mean that funds are irrationally invested in assets with a decreasing capacity to add value. This results in drawing a false picture of economic realities of agricultural holdings which, by nature, demonstrate a high share of physical asset consumption in total production costs. As another consequence, the calculated value of the indicator becomes unacceptable in the long run. The use of the ISVA indicator allowed the author to obtain homogeneous results in terms of methodology and confirming the regularities observed in practice. In addition, the research confirmed not only the fact that agricultural enterprises have intellectual capital resources, but also the high efficiency of their use, exceeding the efficiency of use of traditional ones. It also indicates the desirability of continuing research using measures that will enable the monitoring of intellectual capital and their use in agricultural enterprises.