Economic Value Added as a Measurement Tool of Financial Performance

AbstractThe value-based concept of measuring business performance has its theoretical basis in economic profit. The idea of economic profit is based on the existence of opportunity costs that are very well known in the economic theory. The article deals with measurement of the economic profit by the Economic Value Added indicator. It points out, that when considering the economic profit and its measurement one must first distinguish the theoretical basis of the concept, forms of application and possibilities of application in practice. The gathered data and the transformation of this data from the form provided by the accounting into the desired patterns, respectively into the structures of Economic Value Added plays a key role in these processes. The aim of this paper is to present one of the possible methods of calculating the EVA indicator in conditions of Slovak companies and accounting legislation in Slovakia. Primary data as well as secondary data were used for the purpose of this paper, along with various methods such as analysis, synthesis, deduction, etc