n South African Journal of Economic and Management Sciences - IAS15 inflation adjustments and EVA : empirical evidence from a highly variable inflation regime : inflation
|Article Title||IAS15 inflation adjustments and EVA : empirical evidence from a highly variable inflation regime : inflation|
|© Publisher:||University of Pretoria|
|Journal||South African Journal of Economic and Management Sciences|
|Publication Date||Jun 2009|
|Pages||147 - 161|
|Keyword(s)||E31, E32, Financial performance under inflation, IAS15 inflation adjustments, Nominal EVA values, Real EVA values and South African industrial firms' EVAs|
ISI Social Science
Inflation can have a pronounced effect on the financial performance of a firm. This study makes inflation adjustments to a firm's cost of sales, depreciation, level of gearing and assets in line with International Accounting Standard 15 (IAS15) in order to calculate an inflation-adjusted version of the economic value added (EVA) measure. The study was conducted using data from South African industrial firms during a period characterised by highly variable inflation levels (1991-2005). The results indicate that during this period there were significant differences between the nominal and real values of the firms' EVAs.
Article metrics loading...