The Importance of EconomicValue Added (EVA) and Studies Related To It in Kuwaiti Firms: A Critical Literature Review

Abstract

This study aims two folds. First, it aims to investigate the importance of using economic value added(EVA ) in the evaluation of financial performance in the companies worldwide and how it is used. Second, it aims to reveal the fact about the extent to which studies abouteconomic value added(EVA) are conducted in Kuwait .To achieve this, the researcher has used Google search engine looking for any literature relevant to such subject matter. Many keywords were applied in Arabic and English language. Results revealed thatvarious scholars claimed that (EVA) is more essential in measuring the real financial performance of companies and that it is popular in many countries specially the developed ones to measure financial performance of the corporate sector. In addition, the study found that there are too many formulas or equations that may be used to calculate EVA. More importantly, the results showed that Kuwait, as well as most of the developing countries,has conducted lesser studies about EVA as well as having little concerns with regards to EVA's application as a tool for measuring the performance of the financial companies