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What Is Economic Value Added (EVA)? Why Is It So

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Essay

What is economic value added (EVA)? Why is it so important in comparison to the traditional approach to controlling financial performance?


Definitions:

Cash Receipts and Disbursements

An accounting method that tracks the actual cash flow, recording revenues when received and expenses when paid.

Shareholders

Individuals or entities that own one or more shares of stock in a corporation, giving them ownership interest.

Form 1099-DIV

A tax form issued by banks and financial institutions to investors who receive dividends and distributions from any type of investment during a calendar year.

Dividends

Payments made by a corporation to its shareholders out of its profits or reserves.

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