伊娃管理系统介绍英文

- Processes
specific but limited
▪ Optimized using 4
decisions
criteria
turn the accounting model into an economic model
A
Cash to
D
Economic
J
U
Accrual to
S
Cash
❖ Data Availability
Cost of collecting information must be reasonable
❖ Simplicity
EVA is for operating people – keep it simple
The EVA Calculation Precision Varies
EVA® is Earnings After the Cost of Capital
Revenues - Operating Costs - Depreciation
P/L
-/+ Adjustments - Taxes = Operating Income After Tax (NOPAT)
- Capital
(GAAP)
Income
Accounting
Statements &
▪ Recognizes
Balance Sheets.
equity capital
▪ Use for Peer
has a cost
Benchmarking
▪ Custom-tailored for:
▪ Make all possible Adjustments
Basic EVA
Disclosed EVA
Tailored EVA
True EVA
Basic EVA
Disclosed EVA
Tailored EVA
True EVA
▪ Slight
▪ Adjust publicly
Improvement on
disclosed
Financial
Financial (GAAP)
-$100 -$200 -$300 -$400 -$500 -$600 -$700
1996 1997 1998 1999 2000
Contents
❖ What is EVA? ❖ The calculation of EVA ❖ The EVA management system
to the economic model of the
Cost of Equity
•Equity Risk •Premium
•Risk Free Rate
Cost of Debt •Debt Premium (Credit spread)
+
?%
?%
Cost of Capital ?%
A Beta value is required to determine cost of equity
Strategy
Planning &
Formation Goal Setting Budgeting Execution Evaluation Motivation
P&L Balance Sheet Cash Flow Statement
firm
NOPAT Capital
EVA
Accounting Framework
Adjustments
EVA Framework
❖ 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
伊娃管理系统介绍英文伊娃英文名伊娃英文伊娃格林伊娃科雷柯索娃伊娃冈萨雷斯凌伊娃伊娃朗格利亚伊娃门德斯伊娃爱洛尼斯科林伊娃
Contents
❖ What is EVA? ❖ The calculation of EVA ❖ The EVA management system
Contents
❖ What is EVA? ❖ The calculation of EVA ❖ The EVA management system
Enron’s performance in 2000 was a success by any measure…The company’s net income reached a record in 2000. Enron is laser-focused on earnings per share, and we expect to continue strong earnings performance.
Contents
❖ What is EVA? ❖ The calculation of EVA ❖ The EVA management system
value management framework to translate strategy into action
Value Based Management
OSpettiamruilze ionf tghutmhbeanEd uVsAe cMomemaonssuenrese
❖ Motivation
Adjustment must motivate managers to do the right thing
Start with dysfunctional behaviors in standard operating procedures
(in mil) (in mil)
Net Inc $1,200 $1,000
$800 $600 $400 $200
Net Inc EPS
EPS $1.40 $1.20 $1.00 $0.80 $0.60 $0.40 $0.20
$0
$0.00
1996 1997 1998 1999 2000
EVA
$100 $0
measures Correlation with stock price
50%
40% 30%
20%
10%
EVA
ROE
Cash Flow EPS
Revenue
EVA measure gives more
insights into the business
From Enron’s 2000 Annual Report (Letter to Shareholders):
(Rm - Rf )
Market Risk = 1
Risk (ß)
risk implies higher beta value, hence higher cost of equity
iTnoprcinacilpcaullylastimeilBarebtuas,inaesslissutbojefcpt teoethres snaemeeduntdoerblyeingideeconntoifmieicdfofrocers.{CThlieeynt}
- Organizational ▪ Theoretical but not
Culture
useful…
- Business Mix ▪ …Except when level of
- Strategies
EVA matters; consider additional adjustments for
T
M
Non-recurring
E
Events
N
T
Non-operating
S
Items
Accounting conservatism treats many investments as current expenses (R&D, significant Marketing/Training - only those specifically relating to a “strategic”purpose) EVA views them as investments in the future
Financial measures
Intrinsic value
Market value
¶Competitive strategy
¶Business model
¶Management system
¶Operating efficiency
Hale Waihona Puke ¶Market share, Unit cost, scrap rate, delivery time
Accounting misstates cash flow (Reserves) EVA seeks to emphasize actual cash events
Accounting distorts ongoing operating performance (Restructuring and Asset sales) EVA treatment avoids profit peaks and troughs
and reduce objectivity So as to ❖ To better reflect value creation ❖ To motivate the right value-creating behavior
❖ Materiality
Difference in EVA with or without adjustment – Is it material?
Cost of Equity = Rf + (Beta x MRP)
Relationship between Risk and Return
Cost of Equity Capital (required return by equity holders)
Risk-Free Rate Rf
}
Market Risk Premium MRP
Items not included in the normal course of business, or not usually managed at unit level (Interest Expense from Debt; Other Financing)
The cost of capital comprises both debt & equity costs
B/S
x c%
Capital Charge
= EVA®
•Objective: Continuous Improvement in EVA
The intrinsic value is the
determinant of the market value
in efficient capital market Operating metrics
¶ROI, Capital turnover, margin
¶EVA
¶MVA, Stock price
As a measure of business intrinsic value, EVA correlates with stock price better than other
US as example
may be competitors or companies in similar industries and business environments.
❖ Peer comparisons are used to :
Derive Betas for the respective business units and the corporation to facilitate cost of capital (COC) calculations. Non-listed companies, wholly-owned subsidiaries and business units do not have publicly traded shares from which to measure the levered Betas. Where possible, a pure-play analysis of publicly traded peer companies is used to estimate the unlevered Beta, or BRI. This is then translated into the levered Beta for that company, using the capital