Construction And Application Of SN Company Performance Evaluation Model Based On EVA

In October 2017,the 19 th Congress of the Communist Party put forward the implementation of the new development concept and the construction of a modern economic system.The fifth pointed out that we should speed up the improvement of the socialist market economy system.As we all know,the private enterprise is an important part of the socialist market economy,so,the management and performance evaluation of the private enterprises is of great significance for carrying out the concepts of the 19 th Congress of the Communist Party.In November 2009,the state owned assets supervision and Administration Commission(hereinafter referred to as "SASAC")issued the " assessment plan for economic value added implemented by the central enterprise(Draft)",which clearly pointed out that since 2010,the implementation of EVA in central enterprises should be carried out in an all-round way,so as to guide enterprises to regulate investment behavior.In an increasingly competitive market economy,enterprises will evaluate their financial performance and analyze their operation and management in order to maintain competitive advantage.As an index different from the traditional financial performance evaluation,EVA will bring the cost of equity capital into account,which can effectively reflect the profits of enterprises in operation,help to conduct a comprehensive evaluation of business activities,promote good development and enhance competitiveness.At present,the application of EVA in Chinese enterprises is still at the initial stage.Therefore,most of them are state-owned enterprises,but few are private.Therefore,If we want to really introduce the economic value added into our enterprise management system,we still need a long time of practice exploration and experience summary.In this paper,the private enterprise of SN company is selected as a case subject,so as to improve our country performance evaluation system,consummate the value evaluation system,and provide demonstration for the private enterprise to use EVA for performance evaluation.Based on the above background and purpose,the study is mainly conclucted by case studies,supplemented with normative research method of comparative analysis.The study consists of six parts: the first part introduces the research background and the significance of this paper,presents relevant literature review and points out the research ideas,contents and methods of this paper;the second part elaborates the related theories of performance evaluation including the traditional performance evaluation,EVA performance evaluation,contingency theory and principal-agent theory;the third part analyzes the SN company's current financial performance evaluation system that takes net profit as the core to calculate profitability,debt paying ability,operation capacity and development capability.and found the shortcomings of them.The fourth part constructs the performance evaluation system based on EVA for SN company,and writes the construction of the system from the three aspects of the necessity,the construction principle and the construction steps.The fifth part applies the constructed EVA performance evaluation system to SN company,and summarizes the advantages and disadvantages of the EVA performance evaluation system by comparing with the traditional performance evaluation system.Finally,it puts forward some suggestions for improving the application of EVA.The sixth part draws a conclusion on the basis of the previous article,which that the performance evaluation of SN company based on EVA is very effective,and it can meet the expectations of the shareholders,deal with the principal-agent relationship better,reduce the unnecessary losses,optimize the bilateral interests,and promote the win-win results of the enterprises.This paper only conducts the EVA financial performance evaluation study on the case of SN company,and does not make any further analysis of other enterprises,and there may be a deviation from the analysis results due to the lack of non financial indicators in the construction of the system.Therefore,there are still some shortcomings in the study,which need further exploration.