It is the Introductory Memo assignment Example | Topics and Well Written Essays - 500 words

It is the Introductory Memo - Assignment Example Attaining the position of the Finance Advisor for a company is my ultimate long-term goal. I aim to express exceptional performance in my writing course for this semester. I will strive to internalize every information taught in class. Moreover, I will put into practice the skills learnt in the entire course into a real life situation. I hope to do part-time secretarial job during the vacation, where I will adequately apply the attained business and technical writing skills. I intend to perfect my writing skills by the end of this course. I have vast experience with computers. I usually use my Samsung laptop when at home. My Samsung laptop has the following specifications, Core i7 with a processing speed of 4.00 GHz, and windows 8 installed. I recently worked in Dell Inc. and my key responsibility was to write the incorporation’s newsletters as well as updating the company’s website. These duties greatly improved my writing skills. My earlier workplace was in Coca-Cola Company, where compiled financial report for the company. Some of my achievements include participating in swimming competition, in which I emerged the best. I enrolled in a driving school and attained a license after completing the course successfully. I have also attained a driving license after completing the driving course. I will also list this course among my achievement after completing it successfully. My desire is to excel in both technical and business writing course. I developed an interest to enrol in this course because of what I experienced at my previous workplace. I expect to develop good communication skills by the end of the course. Few business and technical writers exist, and I view this course as an opportunity from which I can earn a living after successfully completing it. In addition, I would want to assist students that struggle to improve their business and technical writing

Dialectics in Oryx and Crake Essay Example for Free

Dialectics in Oryx and Crake Essay Canadian author Margaret Atwood’s novel Oryx and Crake, is about an anti-utopian society that chronicles the collapse of civilization and corrupt medical practice. The town’s morals are highly questionable, in that the majority of the citizens approve of gene splicing, transgenic animals, like mixing a dog’s genetic code with a wolf, and transplanting animal organs in human beings. The book poses a question of what is truly ethical in medical practice? This story has an immediate correlation to the island of Dr.   Moreau, by H. G. Wells, in which a mad scientist creates a dysfunctional society of genetically spliced transgenic animals as well. Like The Island of Dr. Moreau, Margaret Atwood relies on dialectical elements. Dialectic is a classical philosophy originated by the Greeks that depended on the furthering of society through thesis and antithesis. In modern day it has developed between most scholastics as a fine art of persuasion. It is ever present in Oryx and Crake through the dialectics produced through Crake’s insanity. His main dialectical argument is that society has become morally bankrupt and is due for a change and Crake claims intellectual right over all of man kind. His views are presented as deliriously radical, but there is irony in the fact that the University that Crake attends is named Asperger’s U. A term used to describe people who are usually extremely intelligent and often very eccentric, it be could argued that Atwood hints to imply Crake may be the correct one after all, and that the rest of society is wrong. This virtually tyrannical takeover of both the world and the lives of Oryx and Snowman are done entirely through aggressive persuasion. In the formation of Crake, Atwood creates an insanely ranting lunatic, with whom in the end the reader has no choice but to sympathize. The dialectic argument that is posed here is that the dye is cast. Atwood, acknowledges that our society’s morals tread a fine line from damnation, and she writes a novel that puts us one step over that line. The reader has no choice but to sympathize with Crakes’ actions because he is a product of an unbearable world, not too distant from our own. The novel itself, poses a persuasive argument to the reader, in that all of the occurrences in the plot are rationally plausible. There are scenes in the novel where the two men, Crake and Snowman, are attending college together and enjoying their favorite pastimes. These hobbies include, watching nudie news, live executions, and child pornography. In the beginning moments of the lives of the two main characters, the reader views a demoralized world, in which it appears even the plot’s hero is desensitized to the plight of his society. The ironic and reasonable argument posed is that all of these things they are doing, we can do today in our society. At the same time, child pornography, nude news, and live executions online are all either frowned upon and remotely new to our society. Atwood presents the enjoyment of these practices like they are common occurrences. The same goes for gene splicing. It is widely debated as an immoral and illegal act, but it is reasonable enough to think that with the passing of time eventually a law can be passed to legalize both gene splicing and child pornography. This would inadvertently make the use and distribution of these practice more heavily abundant in society and change the moral makeup of the people as a whole. A third persuasive argument the novel poses, and this is more from a perspective of female empowerment, is the idea of polyandry. It is historically a man’s fantasy and an empowering element for the man, while degrading to the woman, for a man to have two wives. Atwood poses the exact opposing scenario in this novel. On one end the idea of polyandry is implied through the relationships both Snowman and Crake have with Oryx. It is directly inferred to in that the Crakers only breed when they are polyandrous. This like most of the novel is a play on societal norms. Underlying in the dialectic argument of the novel are societal implications. For example, by Atwood calling Crakes’ creations the Crakers, she creates an implied connection on words to the Quakers, who are known for starting their own Christian new world. Crake also embodies the values of real time corporations, in that he creates a medical demand for his products through unleashing a virus. His behavior can only be expected by his inherent capabilities and by him being the product of a moral-less society. Atwood’s novel is also fueled by human nature, the horrific experiences the characters go through and their apathetic reactions actually seem believable because they are so human. An example of this is shown in the scene where Crake has just destroyed society as we know it and snowman watches the devastation on the internet, The whole thing seemed like a movie†¦The worst of it was that those people out there – the fear, the suffering, the wholesale death – did not really touch him (Atwood, 2004). It is ironic that Atwood makes a reference to the end of society being like a movie; this exposes snowman’s adolescent and distant nature, as well as makes him appear more human. This also connects back to the live executions witnessed online earlier in the novel. These are examples of Atwood using real time human tendencies to show her characters’ disenfranchisement from society. The actions following this scene consist of snowman leading the Crakers out into the new world in which they find glow-in-the-dark bunnies running rampant. This is another societal implication in that this was the actual result of transgenic Dr. Eduardo Kac, who spliced rabbit and jellyfish DNA in the year 2000. In sum, the dialectic philosophy is present in Margaret Atwood’s novel, Oryx and Crake in that it poses multiple arguments. It supports these arguments through real-time societal implications, believable characters, and a radical thesis carried out by Crake. Atwood’s literary genius is revealed in the fact that, all three of these elements draw sympathy from the reader, and in effect persuade the reader to believe the rationale behind the destruction of their own society.

TEEN Magazine :: essays papers

TEEN Magazine Lately I have been reading the teen magazines YM and Seventeen and I've noticed one thing; they really annoy me. I feel like they are just for preps and the trendoid freaks. Well what about the other groups? The gangsters, punks, skaters, bikers, or whatever. They should really give recognition to the other people in our society. Maybe they want just the good teenagers around. They are not going to get what they want. Maybe they think if they print stuff up all about preps and trends everyone will follow. Well they should guess again. I for one, will not follow any of that shit they say. They give some of the most whacked advice for things. Take romance, I've tried to follow the advice, but my outcome has not been successful. I know other people who have tried, and their outcome has been the same. Take their quizzes, then tell me that you do all that stuff. If you know me, then tell me how often I wear bellbottom pants, or platform shoes, or pink make-up, or little shirts that fit me. For those of you who don't know me, I can tell you right now, I wouldn't be caught dead in that stuff. That takes me to the clothes the models sport. How many girls in this society are actually that skinny? It's actually kind of sick. I think they should widen their models to all sizes and shapes. What? Just because a girl who is not amazingly skinny for a model, the company won't sell anything? Well I can't exactly describe the clothes they wear, but I have never run across a person wearing the same thing. But in Seventeen they have a section called "School Zone" and they go around different schools and take pictures of the students. I can understand the way they dress and they do show different looks. Both magazines put out information about bands, but I don't listen to those bands. As a matter of fact, I hate those bands. They are alternative bands, and coming from me, they just suck. Well I will confess to one thing. I have run across about 3 bands that I do like, but I have been reading these damn magazines for about 3 years. So that tells you something right there. I still haven't listened to a word either one the magazines have said. Otherwise I think I would have been a changed

The Humanistic Perspective on Classroom Management

The humanistic perspective on classroom management. In the education world of today, it is understood that one can only be effective in teaching by taking into consideration the different learning styles of students. In a classroom, it is expected that teachers would want their students to acquire a meaningful knowledge base, become proficient problem solvers and learn how to work productively with others (Biehler and Snowman, 2006, p. 370). If this is the case, teachers need to know how to be able to develop this situation in the classroom and make it more conducive to learning.Therefore, it would seem that they need to encourage students to converse with each other with group discussions and assignments, to make sure they are active in the class, physically as well as mentally, and that they as teachers are rational and firm authority figures in the classroom. The concept of a well-managed classroom would be equivalent to the picture painted here, where students may be interested, motivated and eager to learn. The humanistic approach to teaching is one that is centered on the student.How the student feels and how able they are to relate to what is being taught is most important. This theory believes that if a student can understand how they learn and their behavior in relation to it, and that the classroom can support this behavior, they are more motivated to learn (Biehler and Snowman, 2006, p. 372). The humanistic approach is one that helps students believe in themselves and their potential; it encourages compassion and understanding that fosters self-respect and respect for others.As human beings we all have an innate desire to attain our full potential and achieve what we can to the best of our abilities. This approach shows the appealing idea that students can learn on their terms, or the way they want to, as the instruction in the classroom is geared towards their needs. The humanistic perspective seems to suggest that students would have a more positiv e outlook on education if it was approached in this manner, and there are a lot of people, students included, who support the view also.In terms of instruction, one can see the importance teachers place, or rather should place on reflection; they must constantly be thinking of how to make their teaching better. When thinking about self-improvement, good teachers have to develop their own personal strategies based on existing theories and models; they then utilize those strategies to make decisions in the actual classroom setting. The humanistic perspective in education, seeks to enhance how the basics of reading, writing, computing, vocational skills, problem-solving and decision-making work, by going beyond what is seen as basic (van Zolingen, 2002, p. 19). Humanists know that these skills are necessary and therefore their main interest should be how to get their students to be interested and motivated enough to develop these basic skills. One of the strongest reasons for supportin g humanistic education is that, when done effectively, students learn. If a student feels that the teacher is genuinely concerned about them, accepts and values them and their opinions in the class, they would more likely open up to the teacher and express any concerns they might have.For example, if a student is failing a class, automatically teachers try to tell him or her how to study and prepare for the next test. A teacher following the humanistic perspective would rather, talk to the student about their interest in the subject, what they understand, how they study and even if the teacher’s methods are effective for them. This can better help students to understand their feelings and their role in learning (Biehler and Snowman, 2006, p. 373). It is evident, how this perspective focuses on the student and encourages them to learn by their standards.Considerable evidence shows that cooperative learning structures higher self-concepts, and the student's motivation and inter est in learning are related to greater academic achievement. Three different types of parenting styles are integrated into classroom for more effective teaching. These are the authoritarian, the permissive and the authoritative (Biehler and Snowman, 2006, p. 423). The authoritarian style is on one extreme end, where teachers apply strict rules and expect students to follow them without question and where nothing is negotiable.Their focus then, is not the student but getting compliance from the student, who would be rewarded or punished accordingly. The permissive style is on the other extreme and is as the name suggests. There are hardly any rules and the teacher simply desires the student to identify with and respect him or her. How the student learns and motivating them to do so is not the main priority. The style that is deemed best and superior to the other two is the authoritative.This style is adopted by teachers who desire autonomy in their students. They develop rules and cl assroom norms and explain them to the students, rather than force them to do as they say. This attitude encourages the students to realize how adapting to this behavior will allow them to learn more, which of course, is the main priority of the humanistic teacher. It is possible to say that humanistic education integrated with the authoritative parenting style can lead to fewer discipline problems, both at home and in the classroom.Many parents desire their children to listen more respectfully, choose less impulsively, calm down when overexcited, learn to be assertive without being aggressive and manage their time better. Many humanistic education methods teach students how to do these things. â€Å"Effectiveness training† for example, teaches students how to really listen to others, including parents and â€Å"values clarification† teach students to â€Å"thoughtfully consider the consequences† of their decisions (Green, 1994). Several humanistic education appr oaches teach students to relax and control their nervous energy and to plan and take more responsibility for their time.Humanistic educators often report that parents have told them how good communication was increased in their families as a result of some of the class activities and new skills the students learned. One of the pioneers of the humanistic approach is Abraham Maslow. He studied both behavioral and psychoanalytic psychology, but he rejected the idea that human behavior is controlled only by internal or only by external forces. Instead, Maslow developed a theory he called â€Å"humanistic psychology,† based on his belief that human behavior is controlled by a combination of internal and external factors (DeMarco, 1998).His studies led him to believe that people have certain physiological and psychological needs that are unchanging, identical in all cultures and genetic in origin. Maslow described these needs as being hierarchical in nature and classified them as e ither â€Å"basic† needs, which are low on the hierarchy, or â€Å"growth† needs, which are high on the hierarchy. According to Maslow, an individual must satisfy lower-level basic needs before attempting to meet higher-level growth needs. The basic needs are instinctual needs for food, shelter and safety.Once these necessities of life have been satisfied, higher needs such as understanding, aesthetics and spirituality become important. Maslow called the highest-level need â€Å"self-actualization† and claimed that it could not be attained unless all the needs below it on the hierarchy had been met. Self-actualization is â€Å"the movement toward full development of one’s potential talents and capabilities† (Biehler and Snowman, 2006, p. 543). Most people want to move up the hierarchy toward self-actualization. Unfortunately, the process often is disrupted by a failure to meet lower-level needs.In the classroom, teachers can motivate students to mo ve through the levels and attain self-actualization by understanding how the learning process relates to Maslow's hierarchy of needs (DeMarco, 1998). Maslow's theory of self-actualization describes how highly effective people reach their peak level of performance. Educators can respond to the potential an individual has for growing into a self-actualizing person of his or her own by applying Maslow's motivational theories to the learning process. In most cases, an individual must satisfy lower-level, basic needs before progressing on to higher-level needs.Even the most inspirational educator will not be able to reach a student whose lower-level needs are not being met. Educators cannot assume that all students' basic needs have been met and that it is safe to focus only on higher-level growth needs. Even if a student achieves a certain level on Maslow's hierarchy, life experiences such as a death or divorce in the family may cause an individual to revert to a lower level. Physiologi cal needs are the most basic. If a student is too cold, sleepy, hungry or has an urgent need to use the restroom, he or she will not be able to learn effectively.Teachers can help students meet their basic needs by ensuring that the classroom temperature is comfortable, by giving students breaks during long classes or clinical sessions and by ensuring convenient access to food and drink. After an individual's physiological needs have been met, he or she next focuses on safety needs. A student who is worried about the health or safety of a family member, foe example, cannot perform effectively. It is suggested that students be allowed breaks or the chance to go home and see to personal emergencies when need be. Next in the hierarchy is the need for love and belonging.Maslow points out that â€Å"belonging was an essential and prerequisite human need that had to be met before one could ever achieve a sense of self-worth† (Kunc, 1992). For instance, a student who is made to feel welcome, and to feel like he or she belongs in the classroom, would be more likely to perform well than one who does not have a sense of belonging. Having group discussions and sessions where the students in the class can associate and relate to each other can then promote a unified whole, and give students more of an opportunity to fit in and feel accepted. This then, in its own way promotes learning.In addition to this though, students do not merely want to be accepted alone. The ego is the next step in Maslow's hierarchy, which relates to the fact that students also want to be heard, appreciated and wanted. They need to be encouraged by the teacher, or to have the teacher acknowledge their efforts and praise them for at least trying. If a student is frustrated in the classroom or feels inferior, it will hinder their learning. The final level, self-actualization, is defined by Maslow as â€Å"the full use and exploitation of one's talents, capacities and potentialities† (T ennant, 1997, p. 3). Maslow believed that only 1 in 10 individuals become fully self-actualized, owing to the fact that our society primarily rewards people based on esteem, love and social status. In contrast to this, his theory emphasized that a person's idea of self-actualization can be anything that they want it to be. If a person desired to be class president, owner of a prestigious law firm or a manager in a store; wherever their desire lies, he believed that a person would do all that is possible to get to that point, and thus, attain self-actualization.Again, one can see how the teacher can encourage this in the classroom. A teacher, from his or her own perspective, can identify the strengths of the students in their classroom and encourage or motivate them to build on these strengths, thus helping them on their way to self-actualization and a new level of learning. The humanistic approach seems to be the most agreeable of theories in teaching techniques. Many share the opin ion that a student can truly learn if they have a meaningful relationship with the teacher and also with other students in the class.Students are more behaved and inclined to learn if they feel that their teacher is capable and they can respect him or her, and also, when this respect is reciprocated. The structure of classroom management should be facilitated by the teacher, agreed upon by both students and teacher, be open to revision, and be flexible to accommodate for growth and change in the needs of all classroom participants (DePonte, 2005). The humanistic approach allows one to recognize that part of mplementing any form of classroom management means to distinguish that â€Å"learning† is generated not only through textbooks and lesson plans, but also through interaction and communication prompted as a result of the social learning environment built-in to our classrooms. Therefore, it would seem that the ultimate goal of classroom management is for the teacher to prepa re his or her students for socialization in the â€Å"real† world.The humanistic perspective proves idealistic for instigating and maintaining acceptable â€Å"social learning† boundaries by the means of practical application (DePonte, 2005). For example, if a student demonstrates misbehavior in the classroom, instead of a teacher using verbal or physical punishment, he or she should communicate with the student, to give them the opportunity to realize their errors. The teacher can then guide the student towards a self-realization of consequences, and towards a plan for self-improvement.In this democratic society, it can only be concluded that by mutually agreeing upon rules with the students, a teacher is being proactive by encouraging students to practice self-discipline through collaboration of behavioral rules, and through promoting awareness and respect of their individual differences.ReferencesBiehler, R & Snowman, J. (2006). Psychology applied to teaching (1 1th ed. ). New York: Houghton Mifflin Company. DePonte, Steve. (2005).Classroom management plan. Retrieved November 20, 2008 from http://www. calstatela. edu/faculty/jshindl/cm/DePonteCMP. htm Green, Bob. (1994).What humanistic education is†¦ nd is not. Retrieved November 23, 2008 from http://www. humanistsofutah. org/1994/art2jun94. html Kunc, Norman. (1992).The need to belong: rediscovering Maslow’s hierarchy of needs. Retrieved November 20, 2008 from http://www. normemma. com/armaslow. htm Mary Lou DeMarco. (1998).Maslow in the classroom and the clinic. Radiologic Technology. Retrieved on November 22, 2008 from http://findarticles. com/p/articles/mi_hb3387/is_n1_v70/ai_n28711330 Tennant, Mark. (1997).Psychology and adult learning. Routledge. Van Zolingen, S. J. (2002). The role of key qualifications in the transition from vocational

Economic Value Added

EVA is a way of measuring a firm's profitability. EVA is NOPAT minus a charge for all capital invested in the business (Byrne 1). A more intuitive way to think of EVA is as the difference between a firms NOPAT and its total cost of capital (Kramer & Pushner 40). Stern Staurt's numerical definition of EVA is calculated for any year by multiplying a firm's economic book value of capital  © at the beginning of the year by the spread between its return on capital  ® and its cost of capital (K): EVA=(Rt-Kt)*Ct-1 (Kramer &Pushner 41). EVA is a notion of residual income (Ehrbar Xi). Investors demand a rate of return proportional to the amount of risk incurred. Operating profits determine residual income by plotting them against the required rate of return, a product of both debt and equity. EVA takes into account all capital invested. Peter Druker says in his Harvard Business Review article, â€Å"EVA is based on something we have known for a long time: What we call profits, the money left to service equity, is not profit at all. Until a business returns a profit that is greater than its cost of capital, it operates at a loss. Never mind that it pays taxes if it had a genuine profit. The enterprise still returns less to the economy than it devours in resources†¦. Until then it does not create wealth but destroys it† (Ehrbar 2). EVA is a measure of wealth creation or destruction after all costs are capitalized. Companies use EVA as a measure of corporate performance, as an incentive system and as a link between shareholder and management/employee goals. Stock price indicates investor's certainty concerning current and future earnings potential. EVA is a static measure of corporate performance; MVA is a dynamic, forward looking market performance measure. MVA is a market generated number calculated by subtracting the Capital invested in a firm  © from the sum (V) of the total market value of the firm's equity and book value of debt: MVA=Vt-Ct† (Kramer & Pushner 42). Al Ehrbar describes MVA as exactly equivalent to the stock market's estimate of the NPV of a company. In 1998 CSX Corperation introduced EVA criteria to the fast growing but low margin CSX Intermodal business, where trains deliver freight to waiting trucks or cargo ships. Large amounts of capital are required to power a mammoth fleet of locomotive, containers and railcars. Figuring in capital costs, CSX Intermodal lost $70 million in 1988. â€Å"The CEO issued an ultimatum, et EVA up or be sold† (Fortune, 39). CSX Intermodal freight volume increased by 25%, yet they dramatically reduced their capital cost by reducing the number of container and trailers by 22%, reducing their locomotive fleet by 33%, and reducing fuel costs. EVA in 1992 was $10 million dollars, and was expected to triple the following year. Wall Street responded: CSX stock price rose from $28 before EVA to a 1993 price of $75. CSX concluded that investors care more about their net cash return on capital than accounting figures such as EPS, ROE and ROA. Companies that adopt EVA as a performance measure found tie-in compensation plans very useful in aligning management behavior and shareholder needs. Typical plans consist of two familiar parts, a bonus and stock incentives, applied in new ways (Fortune 50). Bonus targets are established by a percent increase in EVA and recalculated each year by averaging the prior year's goal and the prior year's result. Bonus have no limits, but the manager incurs operating risk because some of the bonus is put in a â€Å"bank,† say, for five years. If over the next five years management performs poorly, and EVA drops, the â€Å"bank† account is depleted. Management incurs the risks and benefits just as owners do. Joel Stern notes that in cases without an EVA incentive plan, employees suffer from a common problem. On average their fixed pay, salaries and pension, are too high, and their variable pay, profit sharing and share options, are to low (Ehbar XIX). Stern adds that size, not value, drives employees in typical incentive programs because size is positively correlated with increases in fixed pay and closely thereafter, variable pay, even if it destroys shareholder wealth. EVA protects shareholder interests by depositing variable pay into a deferred account that can be lost if value is eroded. EVA, as a corporate measure and a predictive tool, generates mixed reviews in the business and academic worlds. AT&T's Jim Meen says, â€Å"The correlation between MVA and EVA is very high. So when your driving your business toward EVA, your really driving the correlation with market value† (Kramer & Pushner, 43). Stern Stewart finds an R squared value of 60% based on 20 groupings of firms (Kramer & Pushner, 41). Contenders site statistical evidence to the contrary. BCG-Holt calculates an R square, after removing 21 outliers, of 27%. Dodd and Chen report that EVA accounts for only 20. 2% of the variation in stock returns for a sample of 500 companies, while ROA explains 24. 5% of market returns (Kramer & Pushner, 43). In their paper â€Å"An Empirical Analysis of Economic Value Added as a Proxy for Market Value Added,† Kramer and Pushner test the hypothesis that EVA is highly correlated with MVA. Simple regression analysis is used to test this hypothesis and other market determinants of market value such as NOPAT. First Kramer and Pushner test the relationship between the level of MVA and the level of EVA using the SS1000. In all cases the level of MVA positively relates to both NOPAT and EVA in the same and prior periods. However, in all cases, NOPAT explains more of the total variation in MVA than EVA† (O'Byrne & Stewart 44). This suggests that the level of NOPAT is not only a better proxy but also a better predictor of corporate performance than the level of EVA. Results for weighted least squares, change in MVA and variations are described graphically in appendix 1. Kramer and Pushner conclude that there is no clear evidence that EVA is the best measure of corporate success in adding value to shareholder investments (Kramer and Pushner, 47). Stephen F. O'Byrne and Stern Stewart and Co. tested a similar hypothesis. Their objective is to show that EVA provides a theoretical and practical measure of operating performance. O'Byrne and Stewart substantiate the explanatory power of EVA relative to earnings because, unlike previous studies, they recognize two important characteristics: Multiples of positive EVA are significantly higher than multiples of negative EVA, which implies that companies with negative EVAs have values that are higher than what would be expected if the market valued EVA at the same multiple. Multiples of capital tend to decline with company size, which suggest that the market assigns higher multiples to a given level of EVA for smaller companies. Stewart, 117). O'Byrne and Stewart suggest at first glance that earnings and EVA have about the same level of success in explaining market value. The variance explained ranges around 32%. Taking into account the two characteristics listed above, the explanatory power of their model increases to 42%. Five-year changes in EVA explain 55% of the variation in market value, and ten-year changes in EVA explain 74% of the variation in ten-year changes. The NOPAT model has 15%-20% less explanatory power. The results of O'Byrne and Stewart research appear in appendix 2. They conclude that because EVA is systematically linked to market value, it proves to be a better predictor of market value than other performance measures. Proponents of EVA also argue that GAAP standards distort true economic reality, produce unreliable corporate standards and serve as an unproductive compensation system. Harvard business school professor Baruch Lev states that; â€Å"Overall, the fragile association between accounting data and capital market's values suggest that usefulness of financial reports is rather limited† (Ehrbar, 161). Some differences in GAAP and economic reality stem from a bias toward conservative estimates, compounded by SEC requirements driving conservative financial policies. The principal divergence is GAAP's treatment of equity. The cost of equity should be capitalized. The cost of borrowed capital shows up in a companies interest expense. â€Å"But the cost of equity capital, which the shareholders have contributed, typically appears nowhere in any financial statement-and equity is extraordinarily expensive† (Fortune, 38). Ehrbar contends that GAAP distorts economic reality in areas such as R&D, strategic management, expense recognition, depreciation, restructuring charges, taxes and balance sheet adjustments (64). R&D under GAAP standards require Corporations to immediately expense R&D in the period in which they occur, where as managers and investors see R&D as an investment. GAAP's treatment of R&D reduces book value by writing down the asset to $0; EVA would capitalize R&D and amortize it over a period of time. Lastly, GAAP incentives can be ineffective motivators. For example, a retiring officer's pension plan is linked to earnings. During their last year they might skimp on R&D to boost earnings because their pension plan is tied to performance. Operating earnings often serve as the benchmark for management compensation. Management has the incentive to negotiate a target that is easy to beat. Managers aim low, insuring their bonus. Trade loading is a second example of how GAAP can affect management decisions concerning bonuses and owner interests. EVA as a measure of financial performance is positively related MVA, but depending on the methodology, the result vary. Kramer and Pushner used simple univariate regressions to compare EVA with other measures explaining EVA. Their results were mixed, NOPAT's explanatory power in Ordinary Least Squares Regressions outperformed EVA by 9%, however when weighted, EVA's explanatory power was higher overall and surpassed NOPAT by 6%. Kramer and Pushner note that the market focuses on profits rather than EVA. Investors rely on earnings estimates that are consistently calculated within the industry. This is not the case for FCF or EVA. Lastly, Kramer and Pushner observe, â€Å"investors certainly need to be aware of capital structure, they should already by familiar with the opportunity cost of their investment and may not need to incorporate this into the measure of performance† (Kramer and Pushner 47). Investors may be familiar with the opportunity cost of their investments, although EVA analysis can illuminate problems, such as those created by GAAP accounting, that may not be recognized otherwise. Stephen O'Byrne and Stern Stewarts calculation required the recognition of two important characteristics that drastically changed the explanatory power of EVA. They note that simple a simple regression model, similar to the one used by Kramer and Pushner, depresses the predictive power of EVA and inflates the predictive power of earnings (Stewart 120). EVA with industry coefficients explains and impressive â€Å"56% of the variation in actual market/capital ratios† (Stewart 121). It also produces notable results for changes in EVA and market value over time. Far better results than NOPAT. My results using a simple linear regression model parallels Kramer and Pushner's results. EVA in 1997 has the highest R square factor, at 33%, but is far from the results calculated by Stewart. EVA's R squared increased dramatically since 1992. This is consistent with the economic trend of the 90's, so the increase may not necessarily reflect an increase in EVA due to internal factors, but an external factor, such as the greatest economic expansion in recorded history. All four factors consistently increase from 1992 to 1997. EVA could be a valuable tool if it is tailored to the company and industry. This requires an understanding and adjustment for different EVA multiples for positive and negative EVA and different capital multiples for different size companies. This requires complex calculations, a regularly cited problem. However, in this context EVA lives up to its reputation as a great measure of corporate performance. Other functions, such as aligning employee and shareholder goals, the basis for an incentive system and a more realistic picture of economic reality, makes EVA more attractive. I would recommend using Stern Stewart model to calculate EVA.