Empirical Study On The Performance Evaluation In Small And Medium Sized Enterprises Board Based On EVA

In 2004, small and medium sized enterprises (SME) board was formally started on the Shenzhen Stock Exchange. The establishment of SME board was of great significance to capital market development.Its performance received extensive attention.Economic value added as a new performance evaluation method has gained great popularity in western country.The EVA theory considered the cost of equity and made the necessary adjustments to the irrational part of accounting system,overcoming the shortcomings of traditional accounting indicators.So EVA can give a more objective reflect on the real business performance.But there nearly were no relevant discussion about using EVA evaluate the performance of SMEs.Therefore,the purpose of this paper is:introducing EVA to the SME board,trying to use empirical research to analyze whether it is superior to use EVA to evaluate the performance of SMEs to the traditional accounting indicators,thus,providing a basis for carrying out EVA performance evaluation in SMEs.In empirical research part,the paper chose market value added to be dependent variable,meanwhile chose EVA and traditional accounting indicators to be independent variable.It adopt correlation analysis by calculating the Pearson correlation coefficient,and established multiple linear regression analysis of econometric models to measure the incremental information of EVA. The research has conclusion as followed:EVA has strong explanatory to the changes of corporation market value,but not enough to fully explain it;The explanation of EVA for the market value are stronger than of the traditional performance measurement,so it indicated that EVA has some additional information over traditional performance measurement.But we can't just use EVA as the only evaluation index.Corporation should use both EVA and traditional accounting index to better evaluate business performance.