The Worth of Disclosures in the Value Added Statement and Pattern of Value Added Distribution

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