Accession Number : ADA294229

Title :   An Analysis of Economic Value Added (BVA) (Trademark) as a Measure of Financial Performance and Risk Assessment.

Descriptive Note : Master's thesis,

Corporate Author : NAVAL POSTGRADUATE SCHOOL MONTEREY CA

Personal Author(s) : Bailey, William E., II

PDF Url : ADA294229

Report Date : DEC 1994

Pagination or Media Count : 93

Abstract : In the fiscal years 1992 through 1994 over 100 million dollars in contracts were terminated for default by the Department of the Navy (DON) alone. There is a need for the Department of Defense (DOD) and the DON to develop or use an accurate and dependable means for assessing which contractors will be able to remain financially capable of fulfilling the terms of their contracts. Currently the Navy uses standard accounting measures and other financial accounting ratios to determine the financial capability of prospective contractors. While the standard accounting ratios and measures have performed adequately, it is possible that improved measures,such as Economic Value Added (EVA (TM)), may exist. This thesis provides some evidence, based on statistical tests using EVA TM data and financial ratio data for the years 1983 through 1992, on the potential value of EVA(TM) as an information item. Specifically, this study determined that EVA(TM) was unique and distinct from traditional accounting ratios and that past EVA TM is an effective predictor of future EVA(TM).

Descriptors :   *ECONOMIC ANALYSIS, *FINANCIAL MANAGEMENT, *CONTRACT ADMINISTRATION, *STATISTICAL TESTS, *CONTRACTORS, RATIOS, DEPARTMENT OF DEFENSE, RISK, ACCOUNTING, PREDICTIONS, NAVY, THESES, FINANCE.

Subject Categories : Administration and Management
      Economics and Cost Analysis
      Government and Political Science
      Statistics and Probability

Distribution Statement : APPROVED FOR PUBLIC RELEASE