Economic Value Added Versus Cash Value Added: The Case of Companies in Transitional Economy, Poland
This paper examines the application of the increasingly popular economic value added (EVA) and cash value added (CVA) measures of financial performance of private and publicly-traded firms. EVA and CVA are measured for a sample of Polish firms. Since traditional accounting measures are not robust in...
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| Format: | Article |
| Language: | English |
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Universiti Utara Malaysia
2006-01-01
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| Series: | The International Journal of Banking and Finance |
| Subjects: | |
| Online Access: | https://www.e-journal.uum.edu.my/index.php/ijbf/article/view/8355 |
| _version_ | 1797958202631913472 |
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| author | Edward Urbanczyk Edyta Midoduchowska-Jaroszewicz Agnieszka Dzczesna-Urbaniak |
| author_facet | Edward Urbanczyk Edyta Midoduchowska-Jaroszewicz Agnieszka Dzczesna-Urbaniak |
| author_sort | Edward Urbanczyk |
| collection | DOAJ |
| description | This paper examines the application of the increasingly popular economic value added (EVA) and cash value added (CVA) measures of financial performance of private and publicly-traded firms. EVA and CVA are measured for a sample of Polish firms. Since traditional accounting measures are not robust indicators of corporate performance of firms in transitional economies, these alternate measures provide better assessment of value/cash flow creation and solvency. The results suggest that Polish firms, though reportedly making accounting profits, are indeed unable to generate value to shareholders. Further, the cash flow measures indicate a great deal of solvency risk. Thus, we recommend the use of these EVA and CVA measures for evaluating performance of companies, especially, in transitional economies.
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| first_indexed | 2024-04-11T00:15:35Z |
| format | Article |
| id | doaj.art-a0987a9126a541868d643af0b571a52b |
| institution | Directory Open Access Journal |
| issn | 2811-3799 2590-423X |
| language | English |
| last_indexed | 2024-04-11T00:15:35Z |
| publishDate | 2006-01-01 |
| publisher | Universiti Utara Malaysia |
| record_format | Article |
| series | The International Journal of Banking and Finance |
| spelling | doaj.art-a0987a9126a541868d643af0b571a52b2023-01-09T03:08:49ZengUniversiti Utara MalaysiaThe International Journal of Banking and Finance2811-37992590-423X2006-01-013Economic Value Added Versus Cash Value Added: The Case of Companies in Transitional Economy, PolandEdward Urbanczyk0Edyta Midoduchowska-Jaroszewicz1Agnieszka Dzczesna-Urbaniak2University of Szczecin, PolandUniversity of Szczecin, PolandUniversity of Szczecin, PolandThis paper examines the application of the increasingly popular economic value added (EVA) and cash value added (CVA) measures of financial performance of private and publicly-traded firms. EVA and CVA are measured for a sample of Polish firms. Since traditional accounting measures are not robust indicators of corporate performance of firms in transitional economies, these alternate measures provide better assessment of value/cash flow creation and solvency. The results suggest that Polish firms, though reportedly making accounting profits, are indeed unable to generate value to shareholders. Further, the cash flow measures indicate a great deal of solvency risk. Thus, we recommend the use of these EVA and CVA measures for evaluating performance of companies, especially, in transitional economies. https://www.e-journal.uum.edu.my/index.php/ijbf/article/view/8355Cash value addedtransitional economieseconomic value addedsolvency |
| spellingShingle | Edward Urbanczyk Edyta Midoduchowska-Jaroszewicz Agnieszka Dzczesna-Urbaniak Economic Value Added Versus Cash Value Added: The Case of Companies in Transitional Economy, Poland The International Journal of Banking and Finance Cash value added transitional economies economic value added solvency |
| title | Economic Value Added Versus Cash Value Added: The Case of Companies in Transitional Economy, Poland |
| title_full | Economic Value Added Versus Cash Value Added: The Case of Companies in Transitional Economy, Poland |
| title_fullStr | Economic Value Added Versus Cash Value Added: The Case of Companies in Transitional Economy, Poland |
| title_full_unstemmed | Economic Value Added Versus Cash Value Added: The Case of Companies in Transitional Economy, Poland |
| title_short | Economic Value Added Versus Cash Value Added: The Case of Companies in Transitional Economy, Poland |
| title_sort | economic value added versus cash value added the case of companies in transitional economy poland |
| topic | Cash value added transitional economies economic value added solvency |
| url | https://www.e-journal.uum.edu.my/index.php/ijbf/article/view/8355 |
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