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Hi sir
One more question on the amount calculated for the capital employed.Any reason why the non cash expenses of $12m was not added back for Yr 2007 capital employed figure?
What I remembered was that past year long term expenses e.g. r&d and non cash e.g.provisions need to be added back to capital employed figures as well.
Capital employed must be the opening CE, so the opening CE for 2007 is the closing for 2006. Any expenditure during 2007 has no effect on that.
The non cash is incurred in both 2006 & 2007. Thus should the CE for 2007 include the $12m of 2006. Im thinking probably the balance is reversed out and thus no balance sheet item to be recognized for CE
Yes. You are correct. I think the 2007 opening CE should have 12 added to it. Adjustments between NOPAT and CE should be consistent.
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