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Value-based management
The big picture
Value-based management (VBM) is a tool for maximising the value of a corporation. VBM uses valuation techniques for performance management, business control and decision-making. The value of a company is determined according to its discounted future cash flows. Value is created when a company invests capital against returns that exceed the capital cost. All strategies and decisions are tested against potential value creation. There are several ways of using VBM. The simplest is the use of VBM for financial reporting. VBM can also be used for capital budgeting and investment analysis. All investments ...
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