The current measurement system of the company is ROI. The ROI target is set based on
budget profit divided by actual beginning of the year net assets. Actual ROI is calculating by
actual profit divided by actual beginning of the year net asset. The advantage of the Abrams
Company ROI system is it does not consider the investment added during the year, because
the investments provide little effort to the year, but more benefit to the future. However, the
ROI measurement system has some weakness, such as defer asset replacement, short-term
focus at the expense of long-term.