Purpose – The purpose of this paper is to contend that Fisherian analysis that is used to resolve ranking conflicts of mutually exclusive projects is misspecified, invalid, and cannot do what it purports to do. Misspecified and invalid models cannot realistically be operationalised, and are...

Purpose – The purpose of this paper is to show that Hamada's equation, which is used operationally to evaluate changes in capital structure as a result of changes in financial leverage, is subject to a number of non‐trivial deficiencies. Each of these deficiencies is of sufficient importance...

Purpose – The purpose of this article is to investigate whether economic value added (EVA ® ) is a superior financial performance metric and creates market value added (MVA), as claimed by Stern Stewart and Company, and therefore is consistent with the purpose and intent of the UK Companies...

Purpose – The purpose of this paper is to consider the attainment of the corporate objective of the UK Companies Act of 2006 Section 172(1) from the perspective of financial valuations that are reliant on the cost of capital. The cost of capital plays an important role in many of the models...

Purpose – The purpose of this paper is to draw attention to the fact that the certainty equivalent coefficient net present value criterion, CEC(NPV), in disregarding a fundamental requirement for the calculation of cash flows for purposes of discounted cash flow analysis, invalidates this...

Purpose – The South African Companies Act of 2008 (SACA2008) seeks to reaffirm the company as a means of promoting the economic welfare and development of South Africa by encouraging efficient, transparent value‐additive corporate management. The purpose of this paper is to present the...