Effect of input values on the resulting cost of equity value calculated by the model INFA

Abstract

The following article is dedicated to one of the few modular models used for determining the cost of capital which is widely used in the Czech Republic. The accuracy of this model is strongly influenced by the input values which are derived from financial statements of rated companies. The paper presents a case study focused on adjustment of input values from the balance sheet which should contribute to more accurate values of the model. Copyright © (2012) by Danube Adria Association for Automation and Manufacturing (DAAAM).