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Hufflepuff Ltd. is a chain of shops selling cards and gifts throughout its country. It has been listed on the stock exchange for ten years

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Hufflepuff Ltd. is a chain of shops selling cards and gifts throughout its country. It has been listed on the stock exchange for ten years and enjoys a fairly high profile in the retail sector of the national economy. You have been asked by the Chief Executive Officer (CEO) to advise the company on value-based management (VBM), as a different approach to performance management. The CEO has read about this method as a way of focusing on shareholder interests and in the current though economic climate, she thinks that it may be a useful development for Hufflepuff. The company has traditionally used earnings per share (EPS) growth and share price in order to assess performance. The changes being proposed are considered significant and the CEO want to be briefed on the implications of the new analysis and also how to convince both the board and the major investors of the benefits. Financial data far Wuffinm...x. Capital employed at the end of the year was: Hufflepuff aims for a capital structure of 60:40 debt to equity. REQUIRED: 4.1 Explain to the CEO what value-based management (VBM) involves and how it can be used to focus the company on shareholder interest. (5) 4.2 Perform an assessment of the financial performance of HUFFLEPUFF using economic value added (EVA) and evaluate your results compared with those of earnings per share (EPS) growth and share price performance. You should state any assumptions made. Round calculations to 3 decimals. 4.3 Evaluate Value Based measures against traditional profit-based measures of performance

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