MARKET-BASED PERFORMANCE MEASURES: A SHAREHOLDER’S PERSPECTIVE

Kód výsledku v IS VaVaI

<a href="https://www.isvavai.cz/riv?ss=detail&h=RIV%2F70883521%3A28120%2F19%3A63523625" target="_blank" >RIV/70883521:28120/19:63523625 - isvavai.cz</a>

Výsledek na webu

<a href="http://dokbat.utb.cz/wp-content/uploads/2020/01/DOKBAT_2019_Conference_Proceedings.pdf" target="_blank" >http://dokbat.utb.cz/wp-content/uploads/2020/01/DOKBAT_2019_Conference_Proceedings.pdf</a>

DOI - Digital Object Identifier

<a href="http://dx.doi.org/10.7441/dokbat.2019.007" target="_blank" >10.7441/dokbat.2019.007</a>

Jazyk výsledku

angličtina

Název v původním jazyce

MARKET-BASED PERFORMANCE MEASURES: A SHAREHOLDER’S PERSPECTIVE

Popis výsledku v původním jazyce

The concept of performance measurement is an important construct in management and strategic management literature. It is a hotly debated topic and a favourite theme in management research. Since performance measurement is a multi-dimensional construct, there is no consensus as to the choice of independent variable in measuring performance. This article contributes to this debate by presenting the two most popular measures, Price-to-Earnings ratio and the Market-to-Book value, commonly considered as market-based performance measures of profitability from the viewpoint of shareholders. Profitability measures are used as indicators of business financial performance in a multi-dimensional performance model. To assess the financial aspect of firm’s performance, researchers generally used either accounting-based or market-based measures. The accounting-based measures are considered back-ward looking and are influenced by accounting standards and management choice of accounting methods. Market-based measures are forward looking and mostly favoured by shareholders. The underlying assumption of the market-based measures is market efficiency, which views stock price as representing the firm’s fundamental value. Market based performance measures incorporates all relevant information and thus not limited to only a single aspect of performance unlike the accounting measures. The theoretical basis for using market-based performance measures is that they reflect a firm’s financial performance more accurately compared to the accounting-based measures.

Název v anglickém jazyce

MARKET-BASED PERFORMANCE MEASURES: A SHAREHOLDER’S PERSPECTIVE

Popis výsledku anglicky

The concept of performance measurement is an important construct in management and strategic management literature. It is a hotly debated topic and a favourite theme in management research. Since performance measurement is a multi-dimensional construct, there is no consensus as to the choice of independent variable in measuring performance. This article contributes to this debate by presenting the two most popular measures, Price-to-Earnings ratio and the Market-to-Book value, commonly considered as market-based performance measures of profitability from the viewpoint of shareholders. Profitability measures are used as indicators of business financial performance in a multi-dimensional performance model. To assess the financial aspect of firm’s performance, researchers generally used either accounting-based or market-based measures. The accounting-based measures are considered back-ward looking and are influenced by accounting standards and management choice of accounting methods. Market-based measures are forward looking and mostly favoured by shareholders. The underlying assumption of the market-based measures is market efficiency, which views stock price as representing the firm’s fundamental value. Market based performance measures incorporates all relevant information and thus not limited to only a single aspect of performance unlike the accounting measures. The theoretical basis for using market-based performance measures is that they reflect a firm’s financial performance more accurately compared to the accounting-based measures.

Druh

D - Stať ve sborníku

CEP obor

—

OECD FORD obor

50206 - Finance

Projekt

—

Návaznosti

V - Vyzkumna aktivita podporovana z jinych verejnych zdroju

Rok uplatnění

2019

Kód důvěrnosti údajů

S - Úplné a pravdivé údaje o projektu nepodléhají ochraně podle zvláštních právních předpisů

Název statě ve sborníku

DOKBAT 2019 - 15th International Bata Conference for Ph.D. Students and Young Researchers

ISBN

978-80-7454-893-2

ISSN

—

e-ISSN

—

Počet stran výsledku

8

Strana od-do

76-83

Název nakladatele

Fakulta managementu a ekonomiky, UTB ve Zlíně

Místo vydání

Zlín

Místo konání akce

Zlín

Datum konání akce

6. 11. 2019

Typ akce podle státní příslušnosti

EUR - Evropská akce

Kód UT WoS článku

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