Reasons for changes in EVA also need to be investigated.
For individual projects, EVA is only really meaningful when looking at the whole lifespan of a project.
In the early years of a project’s life, when the net book value of the assets is higher, the finance charge may also be higher, leading to a lower value of EVA , whereas in later years the reverse is true.
My question is , how are the finance charge higher in the early years, and why is the EVA value lower
Thanks.