Research On Financial Performance Evaluation System Of D Financial Holding Company

Financial performance evaluation has always been an important part of enterprise management.The S AS AC introduced the EVA assessment to the central enterprise as early as 2010,but the financial performance evaluation of most local state-owned enterprises in my country is still centered on profits.The evaluation method will cause enterprises to fall into the embarrassing situation of only short-term interests and ignore long-term development.As a scientific means to evaluate the financial performance of enterprises,EVA pursues’enterprise value maximization’ and takes the cost of equity capital into account when calculating the enterprise value to help enterprises explore management priorities in operation,so as to promote the core competitiveness of enterprises,deepen value management,and achieve excellence and strength.The case company studied in this article is a local state-owned financial holding company.With the development of economic financialization and the continuous reform and innovation of the financial industry,the business of large domestic financial institutions is sinking.At the same time,local small and medium-sized financial institutions are generally small in scale and weak in competitiveness.Against such a background,it would be detrimental to the long-term future development of the Group if it were to continue with its existing profit-focused financial performance evaluation system.Based on stakeholder theory,principal-agent theory,and value management theory,this paper identifies the problems revealed by the current financial performance system of D Financial Holding Company.In response to the problems,EVA was introduced and an EVAbased financial performance evaluation system was constructed for D Financial Holding Company:The indicators within the system have been selected in relation to the characteristics of the industry and the calculation methods are described;Assigning weights to indicators using hierarchical analysis;Based on the efficacy coefficient method,the scoring method is designed to quantify and use for comparison and to analyse the problems of the enterprise.In order to make the constructed financial performance evaluation system play an effective role in D Financial Holding Company,this article also provides corresponding guarantee measures.Research finding:The current financial performance evaluation system of D Financial Holding Company has the problem of neglecting the long-term development of the group,the cost of equity capital,and the easy manipulation of accounting profits.EVA financial performance evaluation considering the debt capital and equity capital of D Financial Holding Company,it can more accurately reflect the value created by the enterprise and help enterprises to establish a value management concept.The system constructed in this paper was also applied to evaluate the financial performance of D Financial Holding Company from 2018 to 2020,and it was found that the overall financial performance of the group for these three years was in the middle of the industry.Among them,the company’s business is subject to higher operational risks and a decline in asset profitability.Investors’ equity capital is not protected and shareholder wealth is impaired;The Group’s capital structure has certain problems,failing to give full play to its financial leverage and having relatively single funding channels;There is a risk of a break in capital flow and the Group’s main business has a poor ability to generate blood,and the Group will need to strengthen its cash collection capacity in the future;Growth capacity is very unstable and capital preservation and appreciation is weak;asset liquidity is reduced and financial management is difficult.In addition,to enable the constructed financial performance evaluation system to play an effective role in D Financial Holding Company,this paper concludes by providing some safeguards,including strengthening the top-level design of EVA,establishing an EVA-based remuneration and incentive system,facilitating the communication mechanism,strengthening the process management and establishing a sound data system.