The Effect of Intangible Assets on Capital Structure

The study mainly examines whether there is effect of intangible assets on capital structure. Test was conducted on data of electronic industry in Taiwan for seven years prior and after the adoption of IFRS. Result of the study showed that the effect of intangible assets on companies’ capital structure is positive, yet not significant, before the adoption of IFRS, but is significantly positive after the adoption of IFRS. Tangible assets also appear to have significantly positive effect on companies’ capital structure both before and after the adoption of IFRS. Thus, the importance of intangible assets in measuring companies’ solvency upon financing is yet to be studied further.