财务管理课件chap001.ppt

1.0Introduction to Financial ManagementChapter 11.1Key Concepts and SkillsnKnow the basic types of financial management decisions and the role of the financial managernKnow the goal of financial managementnKnow the financial implications of the different forms of business organizationnUnderstand the conflicts of interest that can arise between owners and managers1.2Chapter OutlinenFinance:A Quick LooknBusiness Finance and The Financial ManagernForms of Business OrganizationnThe Goal of Financial ManagementnThe Agency Problem and Control of the CorporationnFinancial Markets and the Corporation1.3Basic Areas Of FinanceCorporate financeInvestmentsFinancial institutionsInternational finance1.4InvestmentsWork with financial assets such as stocks and bondsValue of financial assets,risk versus return and asset allocationJob opportunitiesStockbroker or financial advisorPortfolio managerSecurity analyst1.5Financial InstitutionsnCompanies that specialize in financial mattersnBanks commercial and investment,credit unions,savings and loansnInsurance companiesnBrokerage firmsnJob opportunities1.6International FinancenThis is an area of specialization among all of the areas discussed so farnIt may allow you to work in other countries or at least travel on a regular basisnNeed to be familiar with exchange rates and political risknNeed to understand the customs of other countries and speaking a foreign language fluently is also helpful1.7Why Study Finance?nMarketingnBudgets,marketing research,marketing financial productsnAccountingnDual accounting and finance function,preparation of financial statementsnManagementnStrategic thinking,job performance and profitabilitynPersonal financenBudgeting,retirement planning,college planning,day-to-day cash flow issues1.8Business FinancenSome important questions that are answered using financenWhat long-term investments should the firm take on?nWhere will we get the long-term financing to pay for the investment?nHow will we manage the everyday financial activities of the firm?1.9Financial ManagernFinancial managers try to answer some or all of these questionsnThe top financial manager within a firm is usually the Chief Financial Officer(CFO)nTreasurer oversees cash management,credit management,capital expenditures and financial planningnController oversees taxes,cost accounting,financial accounting and data processing1.10Financial Management DecisionsnCapital budgetingnWhat long-term investments or projects should the business take on?nCapital structurenHow should we pay for our assets?nShould we use debt or equity?nWorking capital managementnHow do we manage the day-to-day finances of the firm?1.11Forms of OrganizationnThree major forms in the united statesnSole proprietorshipnPartnershipnGeneralnLimitednCorporationnS-CorpnLimited liability company1.12Sole ProprietorshipnAdvantagesnEasiest to startnLeast regulatednSingle owner keeps all the profitsnTaxed once as personal incomenDisadvantagesnLimited to life of ownernEquity capital limited to owners personal wealthnUnlimited liabilitynDifficult to sell ownership interest1.13PartnershipnAdvantagesnTwo or more ownersnMore capital availablenRelatively easy to startnIncome taxed once as personal incomenDisadvantagesnUnlimited liabilitynGeneral partnershipnLimited partnershipnPartnership dissolves when one partner dies or wishes to sellnDifficult to transfer ownership1.14CorporationnAdvantagesnLimited liabilitynUnlimited lifenSeparation of ownership and managementnTransfer of ownership is easynEasier to raise capitalnDisadvantagesnSeparation of ownership and managementnDouble taxation(income taxed at the corporate rate and then dividends taxed at personal rate)1.15Goal Of Financial ManagementnWhat should be the goal of a corporation?nMaximize profit?nMinimize costs?nMaximize market share?nMaximize the current value of the companys stock?nDoes this mean we should do anything and everything to maximize owner wealth?1.16The Agency ProblemnAgency relationshipnPrincipal hires an agent to represent their interestnStockholders(principals)hire managers(agents)to run the companynAgency problemnConflict of interest between principal and agentnManagement goals and agency costs1.17Managing ManagersnManagerial compensationnIncentives can be used to align management and stockholder interestsnThe incentives need to be structured carefully to make sure that they achieve their goalnCorporate controlnThe threat of a takeover may result in better managementnOther stakeholders1.18Work the Web ExamplenThe Internet provides a wealth of information about individual companiesnOne excellent site is nClick on the web surfer to go to the site,choose a company and see what information you can find!1.19Figure 1.21.20Financial MarketsnCash flows to the firmnPrimary vs.secondary marketsnDealer vs.auction marketsnListed vs.over the counter securitiesnNYSEnNASDAQ1.21Quick QuiznWhat are the four basic areas of finance?nWhat are the three types of financial management decisi