Based on the financial information of 456 firms listed at Shanghai Stock Exchange , this paper investigate the relationship between firm values and EVA , traditional accounting indexes and residual income from year 1999 to 2001. The evidences indicate that though EVA is positively related to firm values , the information content on firm values is very small . After controlling for traditional accounting indexes , EVA does not have any incremental infor2 mation content on firm values. There are significantly positive correlations between firm values and traditional ac2 counting indexes , and accounting indexes can explain firm values very well . Accounting indexes have strong incre2 mental information content on firm values EVA , and can dominate EVA. EVA has incremental information content beyond residual income , and vice versa