KudoZ: term help for translators

The KudoZ network provides a framework for translators and others to assist each other with translations or explanations of terms and short phrases.

German term

Sebastian Witte

Germany

1510 questions

erwartende Ertragskraft

German to English Bus/Financial Law: Taxation & Customs External tax audit (on transfer pricing)

Diese Vorgehensweise widerspricht dem Konzept der „Ewigen Rente“, die von der Annahme einer ***langfristig zu erwartenden Ertragskraft*** des Unternehmens ausgeht.

Does this mean

This method is in conflict with the concept of "perpetual annuity", which is based on the assumption of the company being profitable (sound financial performance) in the long run,

or have I gotten the wrong end of the stick?

If so, would it mean something like

This method is in conflict with the concept of "perpetual annuity", which is based on the assumption of the company's long-term financial performance corresponding to a set value?

I'm confused now.

Proposed translations (English)

presupposes ... earning power

Michael Martin, MA

Discussion

Sebastian Witte (asker) Jan 30, 2014: Thank you, Ted Your translation answers my question.
palilula (X) Jan 30, 2014: Isn't The Question About expected profitability?
Ted Wozniak Jan 30, 2014: actually .... I think "perpetuity model" would be a better rendering of Konzept der ewige Rente.
Ted Wozniak Jan 30, 2014: die ewige Rente the concept of a perpetuity (which seems to have replaced "perpetual annuity" in current usage outside of the insurance field, but I grew up with the latter do it seems fine to me, but I digress ) which assumes the company is expected to be profitable over the long term.