Beruflich Dokumente
Kultur Dokumente
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These goals are frequently incompatible, in that the pursuit of one may result in a less-desirable outcome in regard to another.
Copyright 2007 Pearson Addison-Wesley. All rights reserved.
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Corporate Governance
Although the governance structure of any company domestic, international, or multinational is fundamental to its very existence, this subject has become a lightning rod for political and business debate in the past few years. Spectacular failures in corporate governance have raised issues about the very ethics and culture of the conduct of business.
Copyright 2007 Pearson Addison-Wesley. All rights reserved.
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Corporate Governance
The single overriding objective of corporate governance is the optimization over time of the returns to shareholders. In order to achieve this goal, good governance practices should focus the attention of the board of directors of the corporation by developing and implementing a strategy that ensures corporate growth and improvement in the value of the corporations equity.
Copyright 2007 Pearson Addison-Wesley. All rights reserved.
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Corporate Governance
The most widely accepted statement of good corporate governance practices are established by the OECD:
The corporate governance framework should protect shareholders rights. The corporate governance framework should ensure the equitable treatment of all shareholders. Stakeholders should be involved in corporate governance. Disclosure and transparency is critical. The board of directors should be monitored and held accountable for what guidance it gives.
Copyright 2007 Pearson Addison-Wesley. All rights reserved.
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Penalties have been spelled out for various levels of failure. Most of its terms are appropriate for the US situation, but some terms do conflict with practices in other countries.
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Currency Terminology
Foreign Currency Exchange Rate the price of one countrys currency in units of another currency of commodity.
Can be fixed or floating
Spot Exchange Rate the quoted price for foreign exchange to be delivered at once, or in two days for interbank transactions.
Copyright 2007 Pearson Addison-Wesley. All rights reserved.
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Currency Terminology
Forward Rate the quoted price for foreign exchange to be delivered at a specified date in the future. Can be guaranteed with a forward exchange contract Forward Premium or Discount the percentage difference between the spot and forward exchange rate. Calculated as Spot Forward x 360 x 100 Forward n
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Currency Terminology
Devaluation of a Currency refers to a drop in foreign exchange value of a currency that is pegged to gold or another currency.
The opposite is revaluation
Weakening, deterioration, or depreciation of a Currency refers to a drop in the foreign exchange value of a floating currency.
The opposite is strengthening or appreciation
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Currency Terminology
Soft or Weak describes a currency that is expected to devalue or depreciate relative to major currencies.
Also refers to currencies being artificially sustained by their governments
Hard or Strong describes a currency that is expected to revalue or appreciate relative to major trading currencies. Eurocurrencies are domestic currencies of one country on deposit in a bank in a second country.
Copyright 2007 Pearson Addison-Wesley. All rights reserved.
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(contd)
If all publicly traded firms in the United States are operating within the same basic corporate governance system as Enron, why would some people believe this was an isolated incident, and not an example of many failures to come?
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Chapter Exhibits
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