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The Effects of IFRS on Financial Ratios: Early Evidence in Canada

Blanchette, Michel; Racicot, François-Éric; Girard, … - Certified General Accountants Association of Canada - CGA - 2011

Financial Reporting Standards (IFRS) in Canada. The main features of IFRS are explained in the context of a shift from Canadian … – heavier reliance of IFRS on fair value accounting and comprehensive income, and the use of the entity theory for consolidation …. The effects of IFRS on financial ratios in the areas of liquidity, leverage, coverage and profitability are discussed and …

Persistent link: https://www.econbiz.de/10009144860

Investment, financing and the role of ROA and WACC in value creation

Magni, Carlo Alberto - Dipartimento di Economia "Marco Biagi", Università … - 2015

Evaluating an industrial opportunity often means to engage in financial modelling which results in estimation of a large amount of economic and accounting data, which are then gathered in an economically rational framework: the pro forma financial statements. While the standard net present value...

Persistent link: https://www.econbiz.de/10011188506

Residual income and value creation: An investigation into the lost-capital paradigm

Magni, Carlo Alberto - Volkswirtschaftliche Fakultät, … - 2007

This paper presents a new way of measuring residual income, originally introduced by Magni (2000a, 2000b, 2003). Contrary to the standard residual income, the capital charge is equal to the capital lost by investors. The lost capital may be viewed as (a) the foregone capital, (b) the capital...

Persistent link: https://www.econbiz.de/10011111180

Measuring performance and valuing firms: In search of the lost capital

Magni, Carlo Alberto - Volkswirtschaftliche Fakultät, … - 2007

Residual income as commonly described in academic papers and in real-life applications may be formally described as a function of three variables: (i) the capital invested, (ii) the rate of return, (iii) the opportunity cost of capital. This paper shows that a different paradigm of residual...

Persistent link: https://www.econbiz.de/10011113662

The Internal-Rate-of-Return approach and the AIRR paradigm: A refutation and a corroboration

Magni, Carlo Alberto - MASTER CONSULTORES - 2012

This paper shows that the Internal-Rate-of-Return (IRR) approach is unreliable, and that the recently introduced Average-Internal-Rate-of-Return (AIRR) model constitutes the basis for an alternative theoretical paradigm of rate of return. To this end, we divide the paper into two parts: a pars...

Persistent link: https://www.econbiz.de/10010762951

Accounting and economic measures: an integrated theory of capital budgeting

Magni, Carlo Alberto - MASTER CONSULTORES - 2009

Accounting measures are traditionally considered not significant from an economic point of view. In particular, accounting rates of return are often regarded economically meaningless or, at the very best, poor surrogates for the IRR, which is held to be "the" economic yield. Likewise, residual...

Persistent link: https://www.econbiz.de/10010762964

On the long-standing issue of the internal rate of return: a complete resolution

Magni, Carlo Alberto - MASTER CONSULTORES - 2010

The IRR problem. As widely known, the IRR has serious flaws: (i)multiple real-valued IRRs may arise, (ii) the meaning of each IRR may be ambiguous (rate of return or rate of cost?), (iii)complex-valued IRRs may arise, (iv) the IRR is, in general, incompatible with the net present value (NPV) in...

Persistent link: https://www.econbiz.de/10010762966

Modeling excess profit

Magni, Carlo Alberto - MASTER CONSULTORES - 2009

This paper deals with the problem of modelling in a formal way the concept of excessprofit, also known as residual income. A common idea is that excess profit is an unequivocalconcept, being the diference between profit and costs, where all types of costs are taken into account, included the...

Persistent link: https://www.econbiz.de/10010762997

Economic value added and systemic value added: symmetry, aditive coherence and differences in performance

Ricci, Roberto Ghiselli; Magni, Carlo Alberto - MASTER CONSULTORES - 2009

Two measures of excess profit (residual income) are currently available in the literature: the standard one, of which Economic Value Added (EVA) (Stewart, 1991) is a major instantiation, and Systemic Value Added (SVA) (Magni, 2003, 2004, 2005), also named lost-capital residual income (Magni,...

Persistent link: https://www.econbiz.de/10010763015

A Logical Umbrella for Firm Evaluation: The Fundamental Relation [Un Ombrello Logico Per La Valutazione Di Azienda: La Relazione Fondamentale]

Magni, Carlo Alberto - MASTER CONSULTORES - 2009

This paper analyzes the relations among different concepts such as earnings, profit, interest, rate, consumption, dividend, installment, cash flow, capital. It aims atembracing these notions in a unique conceptual "umbrella" , consisting of five perspectives: (1) accounting, (2) economic theory,...

Persistent link: https://www.econbiz.de/10010763021