EVA was touted as "the way to measure efficiency in a company". The idea behind EVA is to create value for shareholders. To do this, companies must earn returns on invested capital that exceed the cost of capital. This work covers the conceptual and implementational issues, defining EVA and presenting a template that gives the reader a simple, straightforward approach to calculating EVA. It shows how to make accounting adjustments and discusses in detail the two major problems of transfer pricing and short-term bias.
Part One: Understanding EVA. The Shareholder Value Revolution. Value Creation and Economic Value Added. Implementing EVA. Management Compensation. Making It Work: The Technical Side of EVA. The Cost of Capital. EVA. Value Drivers. Management Compensation Revisited. The Metric Wars: EVA versus Cashflow Return on Investment. Understanding the Metric Wars. Part Three: Conclusions. Lessons Learned, and the Future of Economic Value Added.
Series: Professional Finance & Investment
Number Of Pages: 493
Published: 13th December 2000
Publisher: McGraw-Hill Education - Europe
Country of Publication: US
Dimensions (cm): 23.7 x 16.2
Weight (kg): 0.99
Edition Number: 1