The Eps Of The Ifrs As A Benchmark Of Corporate Performance

The measurement of the corporate’s performance; efficiency and effective use of resources has an increasing role nowadays. In a globalizing and strongly competitive market environment the adequate, up-to-date, reliable and accurate information is inevitable for the companies in order to operate efficiently. Accounting is a part of corporate information system that’s primarily objective is to capture the economic changes and to present their effect on the wealth and income of the companies. The performance of companies is interpreted in many ways and there is an extensive literature that discusses performance measurement and depending on the objective and the interested parties there are several methods from simple indicators to the more complicated models. According to the most frequently used definition, performance measurement is the measurement process of the effectiveness and efficiency of activities (Neely et al., 1995). Based on the accounting information of the companies many performance indicators can be shaped that could be useful benchmarks. The companies listed on the stock exchange must put special emphasis on the measurement of their performance and its presentation in the financial statements compared to the non-listed companies as the investor’s primary aim is to maximize the returns on their investments. The national level regulations in this area are not unified; hence the comparison of companies is problematic. The listed companies must present their financial statements in accordance to the International Financial Reporting Standards (IFRS). The standard boards realized the lack of comparability as a result of the non-unified performance measurement. Their opinion is that earnings per share (EPS) is a comparable indicator and shows a consistent picture about the earnings of the companies so in 1997 they issued the IAS 33 ‘Earnings per share’ standard. The IAS 33 provides a standardized method to calculate the EPS that is able to inform the investors reliably about their earnings on their shares. In this study our aim is to introduce the theoretical framework of the standard issued by the International Accounting Standards Committee (IASC), the present the calculation methods of the basic and diluted EPS indicators. We will also the practical application of the method by analysing the financial statements of the 30 companies of the Deutscher Aktienindex (DAX). The current study focuses on the method of performance measurement supported by the IASB that alleviates the comparison of companies and not identical with the performance measurement methods used in the discipline of finance.