Research On Business Line Level EVA Evaluation

Today the EVA theory is used comprehensively with the sense of value creation. What EVA’s key drivers within the enterprise are? This issue has not been a clear answer, As a subsequence, it requires enterprise to analysis internal business factors, study in smaller field and shorter period, in order to identify the key factors for business value. Then the enterprise can better allocate the resources to promote business innovation with EVA theory. This article first reviewed the EVA evaluation of existing theory, mainly including the added value of economic theory is put forward, EVA calculation accounting adjustment, use EVA index of the advantages and limitations of EVA performance evaluation, and should be noted that the limitations and problems of EVA. Then proposed the concept of EVA line of business level, the allocation method of calculating the level of EVA’s line of business costs, allocation of the net assets and the calculation of the evaluation period, cost of capital for research and exploration. Finally, the article takes the XMCJ Company as an example to analysis its industry, business status and key products. And use EVA to analysis its stone and chemical business line in2013. And also analysis on the effectiveness of EVA evaluation system on business line level with improvement suggestions.