Hi,
Is the ROI and ROCE same?
I know ROCE relates to divisional evaluation( return in relation to capital employed) and ROI relates to return an investment make.
But what does it mean when you are asked to calculate ROI for a division?
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ROI and ROCE
2y ago#1ROI is used for divisional performance measurement. ROCE is used for whole companies. Effectively, the basis of the calculations are the same:
Profit (division or company)/Capital employed (division or company).
See Chapter 10 of our notes and lectures.
There is also an extensive technical article on the ACCA website here:
https://www.accaglobal.com/gb/en/student/exam-support-resources/professional-exams-study-resources/p5/technical-articles/divisional-performance-management.html
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