In general, the methods used to measure the financial
performance are quite a lot. Several methods are commonly
used to measure the financial performance and two of them
are the Economic Value Added (EVA) and Market Value
Added (MVA).
Economic Value Added (EVA) is alternative approache as a
measure of profitability that can measure managerial
performance in a certain period. EVA provides a benchmark
of how far the company has been adding value to
shareholders within a year or period. Economic Value Added
(EVA) is positive if the return is higher than the return
required by investors. In addition, The negative Economic
Value Added (EVA) indicates that the value of the company
is reduced so that the resulting rate of return is lower than the
rate of return demanded by investors, which means that the
company failed to create value for the owners of capital