tailieunhanh - Lecture Fundamentals of finance management (10/E) - Chapter 1: An overview of financial management

This chapter presents the following content: Career opportunities, issues of the new millennium, forms of businesses, goals of the corporation, agency relationships. | CHAPTER 1 An Overview of Financial Management Career Opportunities Issues of the New Millennium Forms of Businesses Goals of the Corporation Agency Relationships Career Opportunities in Finance Money and capital markets Investments Financial management Responsibility of the Financial Staff Maximize stock value by: Forecasting and planning Investment and financing decisions Coordination and control Transactions in the financial markets Managing risk Role of Finance in a Typical Business Organization Board of Directors President VP: Sales VP: Finance VP: Operations Treasurer Controller Credit Manager Inventory Manager Capital Budgeting Director Cost Accounting Financial Accounting Tax Department Financial Management Issues of the New Millennium The effect of changing technology The globalization of business Percentage of Revenue and Net Income from Overseas Operations for 10 Well-Known Corporations, 2001 Company % of Revenue from overseas % of Net Income from overseas Coca-Cola Exxon Mobil General Electric General Motors IBM JP Morgan Chase & Co. McDonald’s Merck 3M Sears, Roebuck Alternative Forms of Business Organization Sole proprietorship Partnership Corporation Sole proprietorships & Partnerships Advantages Ease of formation Subject to few regulations No corporate income taxes Disadvantages Difficult to raise capital Unlimited liability Limited life Corporation Advantages Unlimited life Easy transfer of ownership Limited liability Ease of raising capital Disadvantages Double taxation Cost of set-up and report filing Financial Goals of the Corporation The primary financial goal is shareholder wealth maximization, which translates to maximizing stock price. Do firms have any responsibilities to society at large? Is stock price maximization good or bad for society? Should firms behave ethically? Is stock price maximization the same as profit maximization? No, despite | CHAPTER 1 An Overview of Financial Management Career Opportunities Issues of the New Millennium Forms of Businesses Goals of the Corporation Agency Relationships Career Opportunities in Finance Money and capital markets Investments Financial management Responsibility of the Financial Staff Maximize stock value by: Forecasting and planning Investment and financing decisions Coordination and control Transactions in the financial markets Managing risk Role of Finance in a Typical Business Organization Board of Directors President VP: Sales VP: Finance VP: Operations Treasurer Controller Credit Manager Inventory Manager Capital Budgeting Director Cost Accounting Financial Accounting Tax Department Financial Management Issues of the New Millennium The effect of changing technology The globalization of business Percentage of Revenue and Net Income from Overseas Operations for 10 Well-Known Corporations, 2001 Company % of Revenue from overseas % of Net Income from overseas Coca-Cola .