June 2014 Q1

All the marketing costs have been deducted in Appendix 1. This is in line with normal accounting practice which regards these costs as expenses. This is a prudent approach to measuring profits. However, the EVA approach regards many marketing costs and research costs as investments for the future so it is normal to add those back - particularly i, as here, we are told that 50% are for building the brand long-term. These costs are therefore added back to P&L and also capitalised. No adjustment is needed here in the capital employed because EVA always uses the opening capital employed. Had marketing costs such as these been written off in previous years then they would be added back to capital employed so that they are treated as an asset rather than an expense.

Ah thanks a million , i get so worked up in what question is asking sometimes common sense goes out the window Thanks again