n Management Dynamics : Journal of the Southern African Institute for Management Scientists - The relative and incremental information content of the value-based financial performance measure Cash Value Added (CVA)

Volume 17, Issue 1
  • ISSN : 1019-567X



This study investigates the relationship between the measure Cash Value Added (CVA) and market-adjusted share returns, and compares it to that of Economic Value Added (EVA), residual income, earnings and operating cash flow. Relative information content tests suggest that earnings have the strongest relationship with share returns. The results from the incremental information content tests indicate that although the CVA and EVA components provide statistically significant information content beyond that provided by residual income, the level of significance is low.

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