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English translation: Return on Adjusted Capital Employed (RACE)

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GLOSSARY ENTRY (DERIVED FROM QUESTION BELOW)
Swedish term or phrase:justerad avkastning på sysselsatt kapital
English translation:Return on Adjusted Capital Employed (RACE)
Entered by: Glenn Viklund
Options:
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- Include in personal glossary

07:44 Mar 27, 2003
Swedish to English translations [PRO]
Bus/Financial
Swedish term or phrase: sentence
"Justerad avkastning på sysselsatt kapital: Det är ett uttryck för den avkastning som verksamheten lämnat på det förräntningskrävande kapitalet utan påverkan från jämförelsestörande poster."

Maybe:
"Adjusted ROCE: It is an expression of the return the business is realizing on capital employed without the effect of items affecting comparability."

I'm not quite satisified.
Billy McCormac
Local time: 15:35
below
Explanation:
the measure is RACE, which includes the adjustments; Return on Adjusted Capital Employed. (ROCE does not cover the adjustments)

here´s a good explanation:

"The methodology used to develop the company returns and sources of value creation contributing to fundamental differences in downstream performance is described in this section of the report. Conventional profitability measures, such as return on capital employed (ROCE) and return on assets, are not reliable because they ignore important accounting differences among companies that lead to inconsistent comparisons. Return on Adjusted Capital Employed (RACE) is a more meaningful measure of profitability because it adjusts for these accounting differences and enables direct comparisons to the cost of capital, which is the rate of return that investors require.

The major adjustments include:

Adding permanent accounting reserves to book equity and annual changes in these reserves to operating income;

Adding LIFO inventory layers to book equity and annual changes to operating income;

Restating acquisitions to a cash basis and making corollary changes to operating income;

Adding the present value of future operating leases to debt;

Adjusting equity to reflect the cumulative effect of non-operating gains and losses. "


http://www.purvingertz.com/profitstudy2000.html

In other words - the total of these adjustments could be positive or negative. I think "disregarding" is perhaps better than "without" here, to avoid misinterpretations about that.

and possibly I would be a bit more straightforward:

"...an expression of the profit the business is returning.."
Selected response from:

Glenn Viklund
Albania
Local time: 15:35
Grading comment
Thanks again Glenn!
4 KudoZ points were awarded for this answer

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Summary of answers provided
4belowGlenn Viklund
1(tentative variant)
Peter Linton


  

Answers


22 mins   confidence: Answerer confidence 1/5Answerer confidence 1/5
(tentative variant)


Explanation:
Just a suggestion (Note I'm not a qualified accountant):

Adjusted ROCE: means the Return On Capital Employed in the business, ignoring items affecting comparability.

I'm not satisified either, mainly because if it's adjusted, you might expect it to include, not exclude, items affecting comparability.


Peter Linton
Local time: 14:35
Native speaker of: Native in EnglishEnglish
PRO pts in pair: 1432
Login to enter a peer comment (or grade)

2 hrs   confidence: Answerer confidence 4/5Answerer confidence 4/5
below


Explanation:
the measure is RACE, which includes the adjustments; Return on Adjusted Capital Employed. (ROCE does not cover the adjustments)

here´s a good explanation:

"The methodology used to develop the company returns and sources of value creation contributing to fundamental differences in downstream performance is described in this section of the report. Conventional profitability measures, such as return on capital employed (ROCE) and return on assets, are not reliable because they ignore important accounting differences among companies that lead to inconsistent comparisons. Return on Adjusted Capital Employed (RACE) is a more meaningful measure of profitability because it adjusts for these accounting differences and enables direct comparisons to the cost of capital, which is the rate of return that investors require.

The major adjustments include:

Adding permanent accounting reserves to book equity and annual changes in these reserves to operating income;

Adding LIFO inventory layers to book equity and annual changes to operating income;

Restating acquisitions to a cash basis and making corollary changes to operating income;

Adding the present value of future operating leases to debt;

Adjusting equity to reflect the cumulative effect of non-operating gains and losses. "


http://www.purvingertz.com/profitstudy2000.html

In other words - the total of these adjustments could be positive or negative. I think "disregarding" is perhaps better than "without" here, to avoid misinterpretations about that.

and possibly I would be a bit more straightforward:

"...an expression of the profit the business is returning.."


Glenn Viklund
Albania
Local time: 15:35
Native speaker of: Native in SwedishSwedish
PRO pts in pair: 450
Grading comment
Thanks again Glenn!
Login to enter a peer comment (or grade)




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