Financial Management functions
Date: 2015-10-07; view: 458.
(1) __. To be successful in this endeavor, the financial manager must effectively carry out the functions of financial planning and analysis, asset management, and the raising of funds.
Financial Planning and Analysis.(2)__. Long-range plans covering several years must be prepared to project growth in sales, assets, and employees. First, a sales forecast needs to be made that includes expected developments in the economy and that reflects possible competitive pressures from other businesses. The sales forecast then must be supported by plans for an adequate investment in assets. For example, a manufacturing firm must invest in plant and equipment to produce an inventory of products that will fill sales orders. Asset investment plans call for, in turn, plans indicating the size of financing needs. Adequate investment in human resources must be planned for as well.
(3) ___. Cash flows are often monitored on a daily basis for large firms while small firms may make only monthly cash budgets. An unexpected shortage of cash causes financial problems for the financial manager. Having failed to plan for such a need in advance, he or she may have to seek a loan from a bank or other lender when the firm is out of money.
(4) ___. The established firm must conduct a financial analysis of past performance to aid in developing realistic future plans. The new firm should analyze the performance characteristics of other firms in the same industry before making plans. Financial analysis is conducted primarily through the examination of financial ratios, such as the ratio of profits to sales. These are viewed either historically over time or by comparing ratios with other firms in the industry.
Asset Management.(5)___. Investments in fixed assets are necessary to support sales. For manufacturing firms, plant facilities and machinery are necessary to produce the firm's products. In addition to fixed assets, the firm must carry adequate amounts of current assets. Inventory must be accumulated for the purpose of making sales. Cash balances must be maintained to carry on day-to-day transactions, and receivables may be incurred if sales are made on credit.
Raising Funds.(6) ___. Trade credit may be requested from suppliers, short-term bank loans may be obtained, or other current liabilities may be used. Long-term sources of financing may come from profits, the owner's own equity contributions, or long-term borrowing.
(7) ___. In fact, in small firms, the owner usually administers all facets of the business' operations. It is because of this that the small business finds itself at a special disadvantage. Few people have the overall ability to effectively perform the many challenging functions required by even the small business. On the other hand, the medium and large business may, by virtue of size, assign an individual or group of individuals to these special functions and in so doing achieve the efficiency that comes from specialization of talent.
УЧЕБНИК. Melicher, R.W. Finance: introduction to markets, institutions and management / Ronald W. Melicher, Merle T. Welshans. – 8th ed. Ohio, SOUTH_WESTERN PUBLISHING CO. 1992. Pp. 137-138.
2. Work with vocabulary. Identify the words and word combinations marked violet in the text with their definitions given in the table below.
| 1. (n) A. the value of a property after you have taken away the amount left to pay on the mortgage (=money borrowed to buy it); B. the value of a company's shares; C. company shares that can be bought and sold on a stock market | ____________ |
| 2. (v) to get more and more of something over a period of time | |
| 3. (n) A. amounts of money that a company is owed, which count as its assets; B. money due from tenants or clients. ______ are listed as an asset on the balance sheet. One can have a profit on paper, because all the rent charged to tenants counts as income, whether collected or not. One can also have a large amount of assets and be worth a lot of money, on paper, because unpaid rents—________—are listed as an asset. At the same time everything looks rosy on paper, you can be going broke because tenants are not paying their rent, you don't have any hope of ever collecting the past-due receivables, and there is no money to pay the bills. | |
| 4. (n) денежная позиция; остаток кассы; кассовые остатки; остаток денежных средств; денежная наличность; остаток кассовой наличности; кассовая наличность | |
| 5. (2 words) вклад в собственный капитал; вклад в уставный фонд; взносы собственного капитала; инвестиционное участие; прямое участие | |
| 6. (n) A. a factory that makes cars, machines, equipment etc.; B. large machines and equipment used in industry | |
| 7. (adj) of, for, or involving a short period of time in the near future | |
| 8. (2 words) A. credit one firm grants to another firm for the purchase of goods or services. That is, when the goods are delivered, the recipient does not have to pay immediately for the goods - a credit is given with terms for payment (say 30 days). This potentially allows the vendor to sell the goods and use the sale proceeds payoff the credit obligation. B. a loan or line of credit that a company extends to another in order for the second company to buy goods and services, especially those necessary to conduct its operations. | |
| 9. (n) the opportunity to judge or understand past events using knowledge that you have gained since then | |
| 10. (n) money owed by a business, country, or organization | |
| 11. (adj) continuing or looking far into the future | |
| 12. (n) the good judgment to think and plan before an event, so that you are prepared for whatever may happen | |
| 13. (2 words) A. something a company owns and uses but does not sell, for example machines, buildings, or land; B. an asset with a long-term useful life that a company uses to make its products or provide its services. Strictly speaking, a _______ is any asset that the company does not expect to sell for at least a year, but the term often refers to assets a company expects to have indefinitely. Common examples of ________ are real estate and factories, which a company holds for long periods of time. | |
| 14. (v) to make money | |
| 15. (2 words) A. amount owed for salaries, interest, accounts payable and other debts due within 1 year; B. on a balance sheet, any liability expected to be paid off in one year or less. Common examples of __________ are short-term bills and accounts payable. | |
| 16. (prep) because of something; due to something, or as a result of | |
| 17. (n) a list giving details of all the things in a place | |
| 18. (idiom) if two things ____, they exist together and are connected with each other | |
| 19. (phrase) осуществлять продажи в кредит | |
| 20. (n) an effort to do something, especially something new or difficult | |
| 21. (n) an aspect of something such as a situation or someone's character | |
| 22. (n) the tools, machines, or other things that you need for a particular job or activity | |
| 23. (n) A. a piece of equipment that does a particular job by using electricity, steam, gas etc; B. the moving or working parts of a machine | |
| 24. (v) A. to obtain or receive money on loan with the promise or understanding that it will be repaid. B. to receive money from another party with the agreement that the money will be repaid. Most people ___ at interest, meaning they pay a certain percentage of the principal amount to the lender as compensation for _______. Most loans also have a maturity date by which time the person must have repaid the loan. _____ occurs informally from family and friends, at the retail level through a bank, and also on a large scale involving governments and institutional investors. | |
| 25. (2 words) A. value of cash, accounts receivable, inventories, marketable securities and other assets that could be converted to cash in less than 1 year; B. cash and other assets expected to be converted to cash within a year. Examples include accounts receivable, prepaid expenses, and many negotiable securities. __________are calculated on a balance sheet and are one way to measure a company's liquidity. ________ tend not to add much to the company's assets, but help keep it running on a day-to-day basis. |
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| One letter is EXTRA. | | | Work with vocabulary. Identify the words and word combinations from the previous exercise by the context provided. |