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As part of the role to assist senior management,the financial executive needs to find the best metric to measure the financial performance of his organization. Normally,many companies are still using Earnings per share,Returns on Assets as the key performance metric. Introduction: Economic value-added (EVA) has increasingly gain acceptance amongst many [...] To answer the question of how to improve EVA,let’s re-look at its formula:EVA=Net Operating profits after tax – (Capital Employed x Cost of capital) Generally,we can improve EVA by reviewing the components or drivers of EVA: NOPAT IMPROVEMENT: NOPAT is involves with revenue and profit growth. So to [...] Before we even talk about if there is any pitfalls of EVA,we should really note that EVA has many distinctive advantages: In my earlier article,we have compared EVA with earnings per share and return on investment/assets and found that both the traditional ratios do not reflect the true cost of capital- there [...] Recently,the KPMG’s Corporate Shareholder Value Award 2008 ceremony was officiated by Securities Commission chairman Tan Sri Zarinah Anwar. Details: KPMG noted that the average economic profit over invested capital (EP/IC) among the top 100 listed companies here rose to 15.46 per cent last year,compared with 14.35 per cent in 2007 and 13.52 per [...] In FRS112 on Income Taxes or IAS 12,there is a requirement for a reconciliation statement between the Effective tax rate (ETR) to the Statutory Rate in the notes to the financial statement wherein the following are normally taken up: Non allowable expenses Deferred tax assets not recognized Expenses not allowed for tax purposes Non [...] |  FCCA,CA(MIA)with more than 26 years of post-qualifying working experiences. Previous working stints with one of the big accounting four,Regional GFC & Group Treasurer in a group of Malaysian and Group CFO in Singapore public listed concern.Also author to another very popular free educational accounting cum finance blog:http://basiccollegeaccounting.com under the branding of College Accounting Coach. | |||||
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