EconPapers    
Economics at your fingertips  
 

A matrix approach to valuation and performance measurement based on accounting information considering different financing policies

Dirk Beyer ()
Additional contact information
Dirk Beyer: Hochschule Harz

Journal of Management Control: Zeitschrift für Planung und Unternehmenssteuerung, 2018, vol. 29, issue 1, 37-61

Abstract: Abstract Two of the most important issues related to value-based management are a company’s value and the contribution made to it in a certain period. Variations in residual income have been discussed and used for such kinds of valuation purposes and performance measurement for many years to link the value of a company to traditional accounting data. Considering certain financing policies with changing levels of debt, the technical problem of circularity has to be solved concerning the readjustment of the cost of capital. As a practical way to handle that issue, a matrix-based approach is presented in this article. The result of this technique is a vector of the current and future expected amounts of a firm’s goodwill. This vector provides a useful base simultaneously for valuation purposes and for measuring the contribution made to the corporate value in a particular period. Thus, the method presented tackles these two main issues of value-based management at once solely by focusing on traditional accounting data.

Keywords: Residual income; Corporate valuation; Value-based management; Performance measurement (search for similar items in EconPapers)
JEL-codes: G (search for similar items in EconPapers)
Date: 2018
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed

Downloads: (external link)
http://link.springer.com/10.1007/s00187-018-0262-4 Abstract (text/html)
Access to the full text of the articles in this series is restricted.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:spr:jmgtco:v:29:y:2018:i:1:d:10.1007_s00187-018-0262-4

Ordering information: This journal article can be ordered from
http://www.springer.com/economics/journal/187

Access Statistics for this article

Journal of Management Control: Zeitschrift für Planung und Unternehmenssteuerung is currently edited by Thomas Günther

More articles in Journal of Management Control: Zeitschrift für Planung und Unternehmenssteuerung from Springer
Bibliographic data for series maintained by Sonal Shukla ().

 
Page updated 2019-04-09
Handle: RePEc:spr:jmgtco:v:29:y:2018:i:1:d:10.1007_s00187-018-0262-4