《公司财务》学习的英文chap1课件

1、Chapter 1Introduction to Financial Management1第1页，共37页。Chapter OutlineFinance: A Quick LookBusiness Finance and The Financial ManagerForms of Business OrganizationThe Goal of Financial ManagementThe Agency Problem and Control of the CorporationFinancial Markets and the Corporation2第2页，共37页。Key Conce

2、pts and SkillsKnow the basic types of financial management decisions and the role of the financial managerKnow the financial implications of the different forms of business organizationKnow the goal of financial managementUnderstand the conflicts of interest that can arise between owners and manager

3、s3第3页，共37页。Basic Areas Of FinanceCorporate financeInvestmentsFinancial institutionsInternational financeABCACBD4第4页，共37页。InvestmentsWork with financial assets such as stocks and bondsValue of financial assets, risk versus return, and asset allocationJob opportunitiesStockbroker or financial advisorP

4、ortfolio managerSecurity analyst5第5页，共37页。Financial InstitutionsCompanies that specialize in financial mattersBanks commercial and investment, credit unions, savings and loansInsurance companiesBrokerage firmsJob opportunities6第6页，共37页。International FinanceThis is an area of specialization within ea

5、ch of the areas discussed so farIt may allow you to work in other countries or at least travel on a regular basisNeed to be familiar with exchange rates and political riskNeed to understand the customs of other countries; speaking a foreign language fluently is also helpful7第7页，共37页。Why Study Financ

6、e?MarketingBudgets, marketing research, marketing financial productsAccountingDual accounting and finance function, preparation of financial statementsManagementStrategic thinking, job performance, profitabilityPersonal financeBudgeting, retirement planning, college planning, day-to-day cash flow is

7、sues8第8页，共37页。Business FinanceSome important questions that are answered using financeWhat long-term investments should the firm take on?Where will we get the long-term financing to pay for the investments?How will we manage the everyday financial activities of the firm?9第9页，共37页。Financial Managemen

8、t DecisionsCapital budgetingWhat long-term investments or projects should the business take on?Capital structureHow should we pay for our assets?Should we use debt or equity?Working capital managementHow do we manage the day-to-day finances of the firm?10第10页，共37页。Financial Management DecisionsCompa

9、ny (2004 Revenue)Capital BudgetingFinancingBoeing ($52.5b)$7b to design, build, test and sell 787 Dreamliner aircraftNegotiate with suppliers to help to finance the Dreamliner project. A Japanese supplier, who will build the wing and fuselage, are raising and investing more than $1.5bBank of America

10、 ($48.9b)Acquired Fleet Boston Financial for $49bIssued about 600 million new shares to finance the acquisitionBP ($285b)Invested $ 600m to develop oil fields offshore in the Gulf of MexicoAnnounced plans to return surplus cash flow to shareholders through share repurchaseLVMH ($17.1b)Acquired Glenm

11、orangie PLC, a producer of scotch malt whiskiesIssued a 7-year bond in July 2004, raising the euro equivalent of $812 mPfizer ($52.5b)$7.7b on research and testing of new medicinesFinance the research and testing with reinvested cash flow generated by sales of pharmaceutical productsToyota ($164b)Bu

12、ilding an $800m automobile plant in San Antonio, TexasTotal borrowings increased by $2.9b, mainly due to issuance of short-term debt in USWal-Mart ($285b)Plan for 2005 call for up to 530 new retail stores in US and 165 stores in other countriesIssued $1883m long-term debt, maturing in 2036 and payin

13、g interest at 5.25% per year11第11页，共37页。Balance Sheet Model of the FirmCurrent AssetsFixed Assets1 Tangible 2 IntangibleTotal Value of Assets:Shareholders EquityCurrent LiabilitiesLong-Term DebtTotal Firm Value to Investors:12第12页，共37页。The Capital Budgeting DecisionWhat long-term investments should

14、the firm choose?Current AssetsFixed Assets1 Tangible 2 IntangibleTotal Value of Assets:Shareholders EquityCurrent LiabilitiesLong-Term DebtTotal Firm Value to Investors:13第13页，共37页。The Capital Structure DecisionCurrent AssetsFixed Assets1 Tangible 2 IntangibleTotal Value of Assets:How should the fir

15、m raise funds for the selected investments?Shareholders EquityCurrent LiabilitiesLong-Term DebtTotal Firm Value to Investors:14第14页，共37页。Short-Term Asset ManagementHow should short-term assets be managed and financed?Current AssetsFixed Assets1 Tangible 2 IntangibleTotal Value of Assets:Shareholders

16、 EquityCurrent LiabilitiesLong-Term DebtTotal Firm Value to Investors:Net Working Capital15第15页，共37页。Financial ManagerFinancial managers try to answer some, or all, of these questionsThe top financial manager within a firm is usually the Chief Financial Officer (CFO)Treasurer oversees cash managemen

17、t, credit management, capital expenditures, and financial planningController oversees taxes, cost accounting, financial accounting, and data processing16第16页，共37页。Organizing and Managing a CorporationStockholdersBoard of DirectorsPresident, Vice-President, and Other OfficersEmployees of the Corporat

18、ionUltimate control.Stockholders usually meet once a year.Selected by a vote of the stockholders.Overall responsibility for managing the company.17第17页，共37页。Hypothetical Organization ChartChairman of the Board and Chief Executive Officer (CEO)Board of DirectorsPresident and Chief Operating Officer (

19、COO)Vice President and Chief Financial Officer (CFO)TreasurerControllerCash ManagerCapital ExpendituresCredit ManagerFinancial PlanningTax ManagerFinancial AccountingCost Accounting Data Processing 18第18页，共37页。Forms of Business OrganizationSole ProprietorshipPartnershipCorporation19第19页，共37页。Forms o

20、f Business OrganizationThree major forms in the United StatesSole proprietorshipPartnershipGeneralLimitedCorporationLimited liability company20第20页，共37页。Sole ProprietorshipAdvantagesEasiest to startLeast regulatedSingle owner keeps all of the profitsTaxed once as personal incomeDisadvantagesLimited

21、to life of ownerEquity capital limited to owners personal wealthUnlimited liabilityDifficult to sell ownership interestSole Proprietorship21第21页，共37页。PartnershipAdvantagesTwo or more ownersMore capital availableRelatively easy to startIncome taxed once as personal incomeDisadvantagesUnlimited liabil

22、ityGeneral partnershipLimited partnershipPartnership dissolves when one partner dies or wishes to sellDifficult to transfer ownershipPartnership22第22页，共37页。CorporationAdvantagesLimited liabilityUnlimited lifeSeparation of ownership and managementTransfer of ownership is easyEasier to raise capitalDi

23、sadvantagesSeparation of ownership and management (agency problem)Double taxation (income taxed at the corporate rate and then dividends taxed at personal rate, while dividends paid are not tax deductible)Corporation23第23页，共37页。A ComparisonCorporationPartnershipLiquidityShares can be easily exchange

24、dSubject to substantial restrictionsVoting RightsUsually each share gets one voteGeneral Partner is in charge; limited partners may have some voting rightsTaxationDoublePartners pay taxes on distributionsReinvestment and dividend payoutBroad latitudeAll net cash flow is distributed to partnersLiabil

25、ityLimited liabilityGeneral partners may have unlimited liability; limited partners enjoy limited liabilityContinuity Perpetual lifeLimited life24第24页，共37页。Goal of Financial ManagementWhat should be the goal of a corporation?Maximize profit?Minimize costs?Maximize market share?Maximize the current v

26、alue of the companys stock?25第25页，共37页。Goal of Financial ManagementGoal: Maximize the current value per share of existing stockMore general goal: Maximize the market value of the existing owners equity26第26页，共37页。Goal of Financial ManagementDoes this mean we should do anything and everything to maxi

27、mize owner wealth?Sarbanes-Oxley Act27第27页，共37页。The Agency ProblemAgency relationshipPrincipal hires an agent to represent its interestsStockholders (principals) hire managers (agents) to run the companyAgency problemConflict of interest between principal and agentManagement goals and agency costsI

28、hire you to run my companyOK!28第28页，共37页。Managerial GoalsManagerial goals may be different from shareholder goalsExpensive perquisitesSurvivalIndependenceIncreased growth and size are not necessarily equivalent to increased shareholder wealth29第29页，共37页。Managing ManagersManagerial compensationIncent

29、ives can be used to align management and stockholder interestsThe incentives need to be structured carefully to make sure that they achieve their goalCorporate controlThe threat of a takeover may result in better managementOther stakeholders30第30页，共37页。Options are given to key employees to motivate

30、them to:focus on company performance,take a long-run perspective, andremain with the company.Stock Options31第31页，共37页。Example: Work the WebThe Internet provides a wealth of information about individual companiesOne excellent site is Click on the Web surfer to go to the site, choose a company and see what information you can find!32第32页，共37页。Financial MarketsCash flows to the firmU