Analysing performance through value creation

This paper draws a parallel between measuring financial performance in 2 variants: the first one using data offered by accounting, which lays emphasis on maximizing profit, and the second one which aims to create value. The traditional approach to performance is based on some indicators from accounting data: ROI, ROE, EPS. The traditional management, based on analysing the data from accounting, has shown its limits, and a new approach is needed, based on creating value. The evaluation of value based performance tries to avoid the errors due to accounting data, by using other specific indicators: EVA, MVA, TSR, CVA. The main objective is shifted from maximizing the income to maximizing the value created for shareholders. The theoretical part is accompanied by a practical analysis regarding the creation of value and an analysis of the main indicators which evaluate this concept.