Improving management's valuations of human capital in small firms

Author: Barber E   Manger G  

Publisher: Emerald Group Publishing Ltd

ISSN: 0262-1711

Source: The Journal of Management Development, Vol.16, Iss.7, 1997-07, pp. : 457-465

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Abstract

Demonstrates how the human resource element of a small business can be accounted for by Economic Value Added (EVA), as used in the incorporation of equity costs in the valuation of divisions of large companies. Commends the EVA approach as providing a more consistent valuation estimate in the light of an increase in the proportion of human capital.