EVA TRAININGPPT课件.ppt

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Introduction to EVA Management System
Contents
What is EVA?
The calculation of EVA
The EVA management system
EVA® is Earnings After the Cost of Capital
Revenues
- Operating Costs
- Depreciation
-/+ Adjustments
- Taxes
= Operating e After Tax (NOPAT)
Capital
x c%
Capital Charge
= EVA®
Objective: Continuous Improvement in EVA
P/L
B/S
The intrinsic value is the determinant of the market value in efficient capital market
Intrinsic value
Financial measures
Operating metrics
MVA, Stock price
EVA
ROI, Capital turnover, margin
Market share, Unit cost, scrap rate, delivery time
Competitive strategy
Business model
Management system
Operating efficiency
Market value
EVA measure gives more insights into the business
From Enron’s 2000 Annual Report (Letter to Shareholders):
Enron’s performance in 2000 was a ess by any measure…pany’ e reached a record in 2000. Enron is laser-focused on earnings per share, and we expect to continue strong earnings performance.
(in mil)
Net Inc
EPS
EVA
(in mil)
From the traditional accounting model to the economic model of the firm
Accounting
Framework
EVA
Framework
Adjustments
P&L
Balance Sheet
Cash Flow Statement
NOPAT
Capital
EVA
Separate financing effects from operating performance
Extend matching of costs with revenue to economic basis
Separate operating from non-operating
Eliminate book keeping entries/reserves that distort cash flow and reduce objectivity
So as to
To better reflect value creation
To motivate the right value-creating behavior
Optimizing the EVA Measure
Materiality
Difference in EVA with or without adjustment – Is it material?
Set a rule of thumb and mon sense
Motivation
Adjustment must motivate managers to do the right thing
Start with dysfunctional behaviors in standard operating procedures
Data Availability
Cost of collecting information must be reason