Research On Financial Performance Evaluation Of Shanghai Jahwa Enterprise Based On EVA

With the continuous implementation of the overall well-off policy,the quality of life of urban and rural residents in China has been improving,the demand for cosmetics has also shown a spurttype growth.Attracted a large number of well-known foreign cosmetics enterprises to China,resulting in local enterprises and local enterprises and foreign enterprises fierce competition between the market phenomenon.In order to compete for the market,enterprises compete with each other in all aspects.The results of the competition between enterprises will be presented in the financial statements of enterprises in a very intuitive way,so as to reflect the operating conditions of enterprises.However,the method of financial performance evaluation of most enterprises takes net profit as the main evaluation index and does not take into account the cost of shareholders’ investment,so it cannot truly and accurately reflect the value creation of enterprises.Therefore,the concept of EVA(Economic Value Added)is introduced in this paper.EVA,as an indicator different from traditional financial performance evaluation,believes that the capital invested by shareholders also has opportunity cost.Therefore,this part of capital cost is also deducted from after-tax net operating profit,which comprehensively and objectively reflects the operating status of the enterprise and contributes to the healthy development of the enterprise.Taking Shanghai Jahwa as the main research object,this paper analyzes the current financial situation of Shanghai Jahwa from three aspects: asset liability,profit and loss and cash flow.It is found that this simple analysis may find some problems existing in the enterprise,but the fundamental problems cannot be found and properly solved through this analysis method.In addition,whether a series of strategic measures carried out by the enterprise can bring corresponding benefits to the enterprise can not be accurately measured by the current evaluation method.Therefore,it is necessary to establish a set of financial performance evaluation system based on EVA for Jahwa to evaluate the financial situation of the enterprise from the perspective of development and guide the future development of the enterprise.When establishing the financial performance evaluation system based on EVA,first determine the evaluation indexes according to the enterprise characteristics and financial situation,then calculate the weight of each index by using the analytic hierarchy process,and calculate the score of each index by using the efficacy coefficient method.The two are multiplied to obtain the comprehensive score.Finally,the total financial performance score of Jahwa from 2016 to 2021 is obtained by adding all the indexes.The financial score is rated.It is found that the score grades are concentrated in grades B and C,At the upstream level of the industry.On this basis,this paper makes an in-depth and specific analysis on the financial performance of Jahwa in recent six years from four dimensions: financial benefit dimension,solvency dimension,operation ability dimension and development ability dimension.At the same time,it also compares the EVA related indicators of the other four enterprises in the same industry with that of Jahwa to analyze their financial situation more comprehensively.Finally,through the above analysis,it is found that Jahwa has some problems,such as a significant decline in profitability,low asset operation efficiency and unreasonable capital structure.In view of these problems,this paper puts forward some countermeasures,such as improving marketing channels,improving inventory and accounts receivable management system,optimizing capital structure,strengthening R &D ability and establishing EVA based incentive mechanism,In order to provide some ideas for the future development of China’s local cosmetics industry represented by Shanghai Jahwa.