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Compare and contrast the differing views an investor and management may have on financial statements.
How should investors and management view EVA and FCF?
Pick a publically traded company. Go to Wal-Mart Web site, find their annual financial report. If you cannot find it on their site, do an Internet search. Sometimes these are found under Investor Relations on a company’s site. If you still cannot find the annual report, try another search until you find one (for example, search for “GAP Annual Report”). Search for the economic profit, EVA, and free cash flow in the firm’s annual report, and discuss your findings. Discuss the firm’s operations as indicated by their annual report. Submit your backup in Excel or other.
EVA=EBIT (1-T)- (Total investors capital x after-tax cost of capital)
Free Cash Flow = EBIT(1-T) + Depreciation – (Capital Expenditures+ Increase in Net Working Capital)
Identified a company Web site.
Analyzed the company’s annual report by calculating the EVA and FCF.
Presented a structured report that is free of spelling and grammatical errors, and cited sources in APA format.

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