Economic value added (EVA)-A financial performance measure

Economic Value Added (EVA) is a developing concept for measuring financial performance of an Enterprise. This would lead to direct all efforts in creating Shareholders Value (SHV).That the concept becoming popular only after marketed by Stern Stwart & Co of New York based Auditing firm (1991). It is a method of calculating economic profit (Residual Income) by examining the components of Economic Value Added (EVA) and the calculation requires an understanding of its underlying principles. The study examines whether EVA is a superior performance measure both for corporate reporting and for internal governance.