Enterprise Risk Management Slides

Economic capital / Other risks [16]

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Bullet points include: Economic Value Added (EVA, here aka EIC) defined as: Usually focuses on current flow of earnings Potentially manipulatable by managers who do not care about tomorrow’s earnings (e.g. because they may be planning to retire or leave shortly) Working out EVA for multiple lines of business that share costs or have linked revenues can be tricky

Bullet points include: Economic Value Added (EVA, here aka EIC) defined as: Usually focuses on current flow of earnings Potentially manipulatable by managers who do not care about tomorrow’s earnings (e.g. because they may be planning to retire or leave shortly) Working out EVA for multiple lines of business that share costs or have linked revenues can be tricky

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