As Assessment of Financial Management in International Business
Abstract.
Paper discussed how operating of financial management in different nations impacts investment decisions with multinational enterprise. Paper describes financial options available to the foreign subsidiary of the multiple enterprises and shows how money management in international business can be used to minimize cash balances, and taxation and introduce us to basic methods of money management.
This project is focusing on financial management in the international business, discussing three sets financial decisions such as:
• Investing decisions, decisions about what activities to finance.
• Financing decisions, decisions about how to finance those activities.
• Money management decisions, decisions about how to manage firm are financial recourses most efficiently.
Different currencies, tax regimes, regulation concerning cash flow through the countries, norms regarding financial activities, economical and political risks can complicate financial decisions and money management. Financial managers must keep in mind all these factors when deciding which activities to finance, what is the best way to finance them and how to protect company from future political and economical risks including foreign exchange risks.
Investment decisions are the most concern about capital budgeting. Capital budgeting is method to evaluate potential foreign projects, discussions that are made between cash flows to the project and cash flows to the parent company, costs and risks of future investment. Most of international cash out flows are negative at first, because the firms are investing heavily in production facilities. After curtain period of time, cash flows will became positive and investment cost decline and revenues grow. Other problems that may complicate the process, for example, distinction must be made between cash flows into the project and out to the parent, political and economic risks, including foreign exchange risks can affect as well.
Can flows to
Paper discussed how operating of financial management in different nations impacts investment decisions with multinational enterprise. Paper describes financial options available to the foreign subsidiary of the multiple enterprises and shows how money management in international business can be used to minimize cash balances, and taxation and introduce us to basic methods of money management.
This project is focusing on financial management in the international business, discussing three sets financial decisions such as:
• Investing decisions, decisions about what activities to finance.
• Financing decisions, decisions about how to finance those activities.
• Money management decisions, decisions about how to manage firm are financial recourses most efficiently.
Different currencies, tax regimes, regulation concerning cash flow through the countries, norms regarding financial activities, economical and political risks can complicate financial decisions and money management. Financial managers must keep in mind all these factors when deciding which activities to finance, what is the best way to finance them and how to protect company from future political and economical risks including foreign exchange risks.
Investment decisions are the most concern about capital budgeting. Capital budgeting is method to evaluate potential foreign projects, discussions that are made between cash flows to the project and cash flows to the parent company, costs and risks of future investment. Most of international cash out flows are negative at first, because the firms are investing heavily in production facilities. After curtain period of time, cash flows will became positive and investment cost decline and revenues grow. Other problems that may complicate the process, for example, distinction must be made between cash flows into the project and out to the parent, political and economic risks, including foreign exchange risks can affect as well.
Can flows to
References: Contrarian Musings (2009). Corporate Tax Rate by the Country. Retrieved January 24, 2010. http://alhambrainvestments.com/blog/2009/01/29/corporate-tax-rates-by-country-oecd/ Hill, C (2009). International Business Competing in the market Place. New York: McGraw-Hill/Irwin. Stabroek stuff (2010). Caribbean “Tax Haven” Towing the Line. Sunday Starboek. Retrieved on January 24, 2010. http://www.stabroeknews.com/2009/regional/03/30/caribbean-‘tax-havens’-towing-the-line/