International Finance for at&T

International Finance for AT&T
Introduction
AT&T is a multinational company that operates in an abundance of countries throughout the world. This report will discuss many aspects of AT&T as a multinational company including how the global investment banking process has assisted AT&T. Discussion will also explain how the regulatory bodies affect financial decision making, identify and evaluate contemporary issues in international financial description. With AT&T operating on 6 continents throughout the world, the company has access to all financial markets, which increases AT&T’s ability to raise capital worldwide, as oppose to those companies that only operate in one country. The position that AT&T has put itself in by having operations all over the world provides the corporation with an enormous advantage over companies with limited ability to raise capital. Since AT&T is a multinational company it faces varying degrees of challenges put forth by the regulatory boards of the countries in which it does business. The contemporary issues of today can also create challenges for any company domestic, international or multinational; however, multinational companies must remain vigilant to happenings all over the world in order to remain competitive and not succumb to financial hardships based on the current issues.
Global Investment Banking Process
AT&T is a huge company that has a presence all over the world. AT&T’s headquarters are located in the United States but one will find that a presence of the company exists on every continent except Antarctica. AT&T has five international divisions in addition to the United States division, which are AT&T Asia, AT&T EAMA (Europe, Middle East, and Africa), AT&T Canada, AT&T India, and AT&T Latin America/Caribbean. With having a presence in different countries, the company has access to different financial markets and can participate without any hassle because of its foreign presence. Each country has its own regulatory bodies and U.S. companies with a presence in foreign countries must follow the foreign countries’ policies. According to Gitman, a multinational company (MNC) can raise capital in other countries. MNCs can sell shares of its stock in the markets of foreign countries; however, a major requirement is that a MNC must have a presence in that particular foreign country before the corporation can participate in any type of financial trading. The worldwide presence of AT&T subsidiaries in so many countries and the headquarters in the United States increases the corporation’s responsibility for meeting the requirements established by each of the foreign countries where a subsidiary and headquarters is located. “Many commentators agree that most MNCs would benefit enormously from an international stock market that has uniform rules and regulations governing the major stock exchanges. Unfortunately, it will likely be many years before such a market becomes a reality” (Gitman, p. 813). Since being an MNC, companies try to stay on the good side of the foreign countries where a subsidiary or joint venture is located. MNCs generally have most of their debt in the host’s country as a way to decrease political risks. This way, if any governmental changes occur, the government will see that the MNC has contributed to their economy. By having subsidiaries in other countries, the subsidiaries get more leeway than local companies because financial institutions feels the parent company will back them up financially if any financial hardships occur. Since each country has its own currency, the Euromarket is the best market in which to invest. The Euromarket is the international financial market that provides for borrowing and lending currencies outside their country of origin (Gitman, p. 797). Businesses take an interest in the Euromarket because little government presence exists in this market. Because the Unites States have so many regulations, most companies look into foreign markets due to lack of regulations. The global investment banking process has assisted AT&T considerably because it provides them with more investment options with fewer regulations.
How Regulatory Bodies Affect Financial Decision-Making
Regulatory bodies in finance are domestic, national, and international bodies or agencies that establish policies which businesses are required to follow. With AT&T worldwide presence, regulatory bodies on every level affect the corporation. A few national regulatory boards that affect the financial decisions of AT&T are the Security Exchange Commission (SEC), the Federal Trade Commission (FTC), and the Federal Communication Commission (FCC).
The FCC is one of the regulatory boards that affect both financial and operational decision-making. For example, the FCC has adopted policy to advance the well-organized use of numbering assets, including limitations on the task of phone numbers to carriers, which include wireless carriers as well (Anonymous, 2008). The FCC has delegated to states the power to hand over, manage, and protect phone numbers. The FCC lifted its prevention on area code nominated just for consumers using a particular skill, such as an area code for just individuals using wireless technology, and now considers proposal submitted by state commissions looking toward apply this adjust on a case by case foundation. However, depending on the regulations adopted by the states, the supply of accessible numbers might be harmfully confidential (Anonymous, 2008). These are just a few the regulations established by a regulatory body that affects the decision-making of AT&T.
International regulators based on the agreements made between various countries such as the General Agreement on Tariff and Trade (GATT) Treaty, which established the World Trade Organization (WTO), also regulate AT&T’s financial decisions. GATT affects tariffs on costs of services and operations between countries and the WTO assist with any disputes between countries. Assisted by the International division of the FCC, AT&T has a series of domestic and international voice and data connections services that affect financial decisions. AT&T businesses have a series of investments, and a contract for Western Union’s Advanced Transmission Systems division, which includes RCA Global Communication Inc. and Satellite Business Systems. When considering international investment contracts, AT&T has to consider the current regulations for a given location whether domestic, national, or international that affects the financing and operation of the investment.
Contemporary Issues in International Financial Management
To be successful globally, all leaders of management should have a global orientation or at the very least be familiar with the issues facing today’s industry. Management must be ready for some of the international, political, and economical challenges that AT&T is now facing, added to the solid market competition from other cellular and related service providers in this always fast changing world. In the current state of today’s economy where one is not sure what turn of events will take place the next day, special attention must also be given to the current war and terrorism and the global effort that is being made to stop such issues. One of the essential items of for AT&T is that the corporation continues to build its network to continue to remain strong and be ready to run on all cylinders when the economy turns around.
A different, and perhaps more important, risk element concerns economic exposure, which is the potential impact of foreign exchange rate fluctuations on the firm’s value, given that all future revenues and thus net profits can be subject to the risk of such fluctuation. With rates and other related issues on the ups and downs, a necessary objective for AT&T is to keep ahead and to make sure that managers are able to deal with any situation that would arise. “A new world of opportunity is created everyday for companies that can nimbly execute their manufacturing, marketing and sales strategies wherever the potential opportunity presents itself” (AT&T Inc. Enterprise, Our global world, ¶ 1). AT&T remains poised to take advantage of such opportunities even during a time of economic recession. Echoing the words as written on the AT&T Inc. Enterprise website:
Success is built upon the seamless integration of operations across geographies. From the coverage of the infrastructure, to the security of the information flow, to the reliability and continuity in the face of potential disruption, to the productivity of driving more value across sunk investments. All these networking requirements are fundamental enablers of business success. Each must be comprehensively and competently addressed if an enterprise is to prosper globally. (Our global world, 2nd paragraph)

Conclusion
Multinational companies face greater challenges and have greater potential to raise capital than companies that choose to only do business domestically or internationally since government regulations vary greatly from country to country, AT&T is no different. AT&T has been a successful corporation at all levels and has used its multinational status to its advantage to reach a greater number of markets, investors and raise capital to propel the company to the top of the industry. Risk is a major concern associated with multinational companies; however, each company essentially determines its own fate and destiny by the way in which they conduct business, accept and use the risks to their advantage, and cope with the contemporary issues of today. References
Anonymous, (2008). United States Security and Exchange Commission. Retrieved May 10, 2009, from http://www4.sprint.com/3ar/downloads/sprint03arForm10K
AT&T Inc. Enterprise. Global networking. Retrieved May 8, 2009 from http://www.corp.att.com/globalnetworking/
AT&T Inc. Enterprise. Our global story. Retrieved May 8, 2009 from http://www.corp.att.com/globalnetworking/our_global_story.html
Gitman, L. (2005). Principles of managerial finance, 11e. [University of Phoenix Custom Edition e-text]. Upper Saddle River, NJ: Prentice Hall. Retrieved May 8, 2009, from University of Phoenix, Finance for Decision Making FIN419 Course Web site

References: Anonymous, (2008). United States Security and Exchange Commission. Retrieved May 10, 2009, from http://www4.sprint.com/3ar/downloads/sprint03arForm10K AT&T Inc. Enterprise. Global networking. Retrieved May 8, 2009 from http://www.corp.att.com/globalnetworking/ AT&T Inc. Enterprise. Our global story. Retrieved May 8, 2009 from http://www.corp.att.com/globalnetworking/our_global_story.html Gitman, L. (2005). Principles of managerial finance, 11e. [University of Phoenix Custom Edition e-text]. Upper Saddle River, NJ: Prentice Hall. Retrieved May 8, 2009, from University of Phoenix, Finance for Decision Making FIN419 Course Web site