analysis of the performance evaluation method using eva in soes（分析性能评估方法在国有企业中使用伊娃）.doc

Analysis of the performance evaluation method using EVA in SOEs REVIEW Papers :: With the deepening of economic reform, China’s business objectives to maximize the positive maximize profits from the traditional to the shareholders ‘equity, based on the assessment of business performance also gradually shift value in shareholders’ equity from traditional accounting profit targets indicators. EVA as a new scientific method for performance evaluation, and application of concern in recent years, a growing number of state-owned enterprises. Based on the discussion on the meaning of economic value added, the impact of factors on the EVA used in the performance evaluation of state-owned enterprises were analyzed separately, and make recommendations on this basis. Paper Keywords: EVA Performance Evaluation Methods The analysis of state-owned enterprises I. Introduction In 1982, the US consulting firm Stern Stewart put forward the concept of EVA, EVA creation of management has brought a revolution. EVA is economic value added (Economic Value Added) English acronym refers to the after-tax adjusted operating profit minus the residual income debt costs and cost of capital, which is what economists call ‘economic profit’ . The basic formula for calculating EVA is: EVA = Adjusted operating profit - the average balance of capital * weighted average cost of capital. Second, the connotation of economic value added since the 1990s, a growing number of scholars have pointed out the profit target does not fully reflect the efficiency and value creation of capital management, economic value added since then have been gradually introduced into the performance evaluation. To bring new ideas to implement EVA think, EVA only to recover the cost of capital is the real profits after the traditional accounting book profit is not really profit, if EVA is negative, even if the financial statements is a loss of profits. Namely: EVAgt; 0, show that corporate managers in the busin