Beruflich Dokumente
Kultur Dokumente
By taking actions that generate benefits in excess of costs, firms generate wealth for their investors.
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Budgeting, financial forecasting, cash management, credit administration, investment analysis, fund procurement Consumer banking Corporate banking High income potential Very competitive industry Opportunities in investment advisory firms, mutual fund companies, pension funds, investment arms of financial departments Advise on business practices and strategies of corporate clients
Consulting
Capital Budgeting
Financial Management
Corporate Governance
Risk Management
Corporations can raise equity capital privately, or they may go public by conducting an initial public offering (IPO) of stock.
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Capital Budgeting selecting the best projects in which to invest the resources of the firm, based on each projects perceived risk and expected return.
Select investments for which the marginal benefits exceed the marginal costs.
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Equity Capital
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Financial Intermediation
Financial Intermediary
An institution that raises capital by issuing liabilities against itself, and then lends that capital to corporate and individual borrowers. Examples: insurance companies, savings and loan institutions, credit unions, commercial banks, pension funds, mutual funds.
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Pension funds and mutual funds, have surged to prominence as corporate finance shifts towards greater reliance on market-based external funding.
Partnerships
Limited Partnerships
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One or more general partners & many limited partners Limited liability of corporation, tax benefits of partnership
Corporations
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S Corporations
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Maximize profit?
Earnings reflect past performance, rather than current or future performance. Ignores the timing of the profits. Ignores cash flows. Ignores risk.
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Focus on stakeholders?
Many firms seek to preserve the interests of other stakeholders, such as employees, customers, tax authorities, and the communities where the firms operate. Doing so provides long-term benefits to shareholders and is in line with the primary goal of maximizing shareholder wealth.
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Select investments for which the marginal benefits exceed the marginal costs.
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