Abstract This paper explains the process of cash flow management. The author discusses the proactive role that the company treasurer can take in managing the credit and collection function. The paper describes the job of various employees in financial management.
From the Paper "According to Lucy Reuben writing in "Black Collegian" every organization, private or public, large or small, depends upon a management team that generates cash inflows sufficient to cover required cash outlays. Corporate financial management covers a diverse range of responsibilities related to the procurement and use of cash flows. These responsibilities are generally divided between a treasurer and a controller who both report to the vice-president of finance. The controller handles issues such as capital budgeting profit and loss analysis and working capital management. The treasurer's side ..."
This paper is a research proposal on the risk and opportunities of working capital, working capital management, cash conversion cycle and creditmanagement, among others.
Abstract This paper is a research proposal that discusses Lawrence Sports, a company that manufactures and distributes sports equipment and protective gear. Lawrence has a cash flow problem because its largest customer, Mayo Stores, is not paying on time. This paper benchmarks other companies to determine an alternative solution which will enable the company to improve its overall cash flows. The paper introduces research that assesses the risks and opportunities of working capital, working capital management, cash conversion cycle, creditmanagement, and short-term financing/debt reduction to prepare for long-term opportunities, cash flow, and identifies the best practices in working capital management. Also, the paper has a large appendix with information from multiple companies.
Outline:
Abstract
Introduction
Conclusion
References
Appendices
Borders
General Electric
Magna Entertainment Corporation
Fleetwood Enterprise
Wal-Mart
Starbucks
Graham Manufacturing
Dell Computers
From the Paper "In addition to the other working capital issues identified, Lawrence Sports also is experiencing issues with its cash conversion cycle. Currently, Lawrence is using short-term financing in the form of cash from operations and a bank line of credit to not only finance short term assets such as inventory but also ongoing operations. Doing so places a significant pressure on the company to convert cash quickly. Benchmarking two other companies who have successfully controlled their cash conversion cycle could lend insights to Lawrence on how its CCC may be improved.
"Graham Manufacturing had a CCC of 134 days in 2004. By reducing the amount of time to collect 42% in 2007 and 37% in 2006 as well as increasing the amount of customer deposits prior to delivery of product Graham reduced its CCC down to 46 days by Q1 FY08. Following Graham's example Lawrence Sports could reduce its CCC by requiring Mayo, its largest customer, to pay more than 20% at the time of order. Additionally, Lawrence should focus on faster collections just as Graham did successfully. Such a plan could take the form of discounts for prompt payment or negotiate an interest charge for delayed payment."
This paper is a research proposal on the risk and opportunities of working capital, working capital management, cash conversion cycle and creditmanagement, among others.
Abstract This paper is a research proposal that discusses Lawrence Sports, a company that manufactures and distributes sports equipment and protective gear. Lawrence has a cash flow problem because largest customer, Mayo Stores is not paying on time. This paper benchmarks other companies to determine an alternative solution which will enable the company to improve its overall cash flows. The paper introduces research that assesses the risks and opportunities of working capital, working capital management, cash conversion cycle, creditmanagement, and short-term financing/debt reduction to prepare for long-term opportunities, cash flow, and identifies the best practices in working capital management. Also, the paper has a large appendix with information from multiple companies.
Outline:
Abstract
Introduction
Conclusion
References
Appendices
Borders
General Electric
Magna Entertainment Corporation
Fleetwood Enterprise
Wal-Mart
Starbucks
Graham Manufacturing
Dell Computers
From the Paper "In addition to the other working capital issues identified, Lawrence Sports also is experiencing issues with its cash conversion cycle. Currently, Lawrence is using short-term financing in the form of cash from operations and a bank line of credit to not only finance short term assets such as inventory but also ongoing operations. Doing so places a significant pressure on the company to convert cash quickly. Benchmarking two other companies who have successfully controlled their cash conversion cycle could lend insights to Lawrence on how its CCC may be improved.
"Graham Manufacturing had a CCC of 134 days in 2004. By reducing the amount of time to collect 42% in 2007 and 37% in 2006 as well as increasing the amount of customer deposits prior to delivery of product Graham reduced its CCC down to 46 days by Q1 FY08. Following Graham's example Lawrence Sports could reduce its CCC by requiring Mayo, its largest customer, to pay more than 20% at the time of order. Additionally, Lawrence should focus on faster collections just as Graham did successfully. Such a plan could take the form of discounts for prompt payment or negotiate an interest charge for delayed payment."
Abstract This paper discusses the advantages and disadvantages of credit risk management software as a risk mitigation tool. The author explains the use of credit-scoring models. The paper demonstrates the application of credit-scoring to CRM software.
From the Paper "For more than four decades, creditors doing business with consumers have been using credit-scoring models to determine if applicants are good credit risks. Information about an applicant's credit history including the amount of debt they have outstanding their bill-paying history any history of late payments and the number of times they have been sued or placed for collection are all factors that CRM programs use to establish an appropriate credit limit for a consumer credit applicant. Fay Hansen in "Business Credit" reports that a few years ago ....."
Abstract This paper explains that the goal of its thesis is to conceive a model to manage the global interest rate risk of the commercial portfolio in order to determine the optimal structure of the new production and to test the tool on the Credit Foncier de Monaco, private banking and subsidiary of Calyon, which is obviously the investment banking of Credit Agricole. The paper's thesis is divided into two main sections: the theoretical modeling and the empirical application.
Table of Contents:
Abstract
Abbreviations
Introduction
Theoretical Modeling
Identification
Interest Rate
Nominal vs. Real Rate
Fixed vs. Variable Interest Rate
Short-Term vs Long-Term Rates
Spot vs. Forward Rates
Term Structure of Interests
Theories
Methods
Deterministic and Stochastic Models
Sources of Interest Rate Risk
Repricing or Maturity Mismatch Risk
Basis or Bid-Ask Spread Risk
Yield Curve Risk
Options Risk
Interest Rate Exposure
Net and Gross Positions
Balance-Sheet & Gap
Profit and Loss Statement and Spread
Factors
Measurement
Volume
Instantaneous Gaps
Generalized Gaps
Indexed Gaps
Simulated Gaps
Value
Duration
Convexity
Market
Margin
Sensitivity
Modified Duration and Relative Convexity
Money Markets Rates
Management Hedging And Speculation
Micro or Macro Hedging
Systematic or Selective Hedging
Partial and Total Speculation
Hedging Risk and Opportunity Cost
Passive and Active Hedging
Passive Hedging or Beta Management Active Hedging or Alpha Management Instruments
Spot
Forward And Future
Fra And Swaps
Options
Modeling
Utility
Structure
Utility Function
Constraints
Regulation
Commercial
Model
Objective Function
Efficient Portfolio
Optimal Portfolio
Empirical Application
Presentation
Cfm
Treasury
Asset-Liability Management (Alm) Committee
Adaptation
Structure
Constraints
Rates
Simulation
Leverage
Regulatory Constraints
Variance-Covariance Matrix
Utility
Variances
Conclusion
Glossary
Appendix: Balance-Sheet + Profit & Loss Statement
Appendix: Balance-Sheets by Currency, Maturity and Interest Rate
Appendix: Gaps
Appendix: Correlation and Variance-Covariance Matrix
Appendix: Weightings and Balance-Sheets in March 2008
Appendix: Coefficients of Variation
Appendix: Objective Function for Different Aversions to Risk
From the Paper "Taking into account the stock and constraints, the model determines the optimal allocation of the production for different scenarios of rates level, rates volatility and risk aversion degrees. The bank hedges against the interest rate risk by optimally adjusting its production.
"The optimal portfolio is the tangent point between the efficient frontier and the indifferent curve. It is obtained by equalizing the marginal rate of transformation (MRT) to the risk to return, which is the slope of the efficient frontier, and the marginal rate of substitution (MRS) to the risk to return, which is the slope of the objective function."
Tags: tool transformation, tangent point, risk premium, asset management
This paper addresses the credit report, including how and why a credit report is important and exactly how the credit report can impact the individual.
1,900 words (approx. 7.6 pages), 4 sources, 2002, $ 71.95
Abstract This paper addresses the credit report, including how and why a credit report is important and exactly how the credit report can impact the individual. This paper provides information first on the appropriate steps necessary to acquire a full credit report, and the reasons the average consumer might wish to do so. This paper then investigates the scams that accompany credit and credit reports in order to better inform the reader of the problems that might occur in acquiring a credit report through non- official channels.
Tags: BUSINESS / FINANCE, ECONOMICS, ACCOUNTING, the credit report
Abstract This paper discusses credit derivatives in modern banking. The paper gives a brief outline of credit derivatives, and further discusses the concept of how they function within the global market. The paper examines occurrences within banking in relation to credit derivatives and how these events have affected the worldwide opinion regarding the limitations of these transactions. The paper draws conclusions from the research provided, and offers opinions for the future of credit derivatives in banking.
From the Paper "When the economy is stable and interest rates are low, banks traditionally struggle for profits because there is not a significant need for loans from consumers or big business. In these moments of financial peace, banks needed methods that would ensure they could survive independently on the downfall of the economy in order to remain solvent. Credit derivatives were born of such concern, allowing bankers, and others, the ability to reduce their risk by selling risk to other parties. Risk was still maintained by lending institutions, but the prospect of intense profit margins was the deciding factor for most banks to begin to participate in credit derivatives. The research will demonstrate that bank use of credit derivatives has been a recorded success, and that credit derivatives continue to grow across the globe as a boom to the banking industry. However, limitations do exist connected with credit derivatives."
Abstract This paper examines how the organizational culture and management style at Enron contributed to this culture of silence that both silenced critics and forced employees to go along with management's questionable decisions. It focuses particularly on the organizational style of Jeffrey K. Skilling, whose tenure as Enron's Chief Operating Officer is largely credited with sowing the seeds of Enron's destruction.
From the Paper "Skilling's micro-management style and rank and yank policies resulted in an intense competition among Enron executives. Robert J. Hermann, Enron's former tax counsel, described the culture of Schilling's Enron as "me first, I want to get paid...There were always people wanting to do deals that didn't make sense in order to get a bonus" (cited in Behr and Witt, "Visionary's Dream Led to Risky Business"). Whenever possible, Schilling reportedly used such financial incentives to shore up his "loose-tight" management style."
Highlights the main reasons why membership in the Employee Federal Credit Union (EFCU) is shrinking and why individuals are opting for commercial banking when credit unions offer loans at lower rates.
Abstract This research report addresses the main reasons why EFCU has encountered a decline in membership and what is prompting people to borrow from other financial bodies. In order to better understand these reasons, however, the paper first looks at why people are initially attracted to credit unions instead of commercial banks and the principles that guide the growth of credit unions. The report is based on a survey of EFCU members, which was conducted through mailed questionnaires.
From the Paper "This has been a major setback for most federal credit unions including EFCU the number of its members has decreased and many existing members prefer commercial banks to meet their loan requirements. While the governmental regulations are certainly playing a dominant role in poor performance of credit unions in last few years, we must not forget how banking industry has persistently forced the government to develop such legislation. The worst part is that due to this persistent challenges, market share of credit unions came down to 12% in 1995 from 13% in 1980 while that of bans increased from 50 to 56% during these fifteen years."
Abstract This paper provides an extensive review of the recent literature relevant to pricing credit derivatives. The paper discusses new developments in credit derivative pricing and explains that these new developments are those innovations that expand or clarify the existing variations models for credit derivatives.
From the Paper "The purpose of this study is to review new developments in the pricing of credit derivatives. Credit derivatives, essentially insurance against credit risk through the structuring of and trading in of synthetic financial assets, are little more than a decade old. Thus, a skeptic might state that almost anything that occurs in the credit derivative market reflects a new development. The perspective providing the focus in this study however is that new developments are those innovations that expand or clarify the..."
Abstract This paper discusses the use of an enterprise database management system and outlines the ways in which it can be used by a government contracting company to expand its business. The paper also highlights the attracting features and functionality offered by a DBMS and explains how it can improve activities at strategic, tactical and operational levels.
From the Paper "A DBMS renders the interface between the application program and the data. If the Government Contracting Company plans to expand its business, then a DBMS would make the data representation for the users and the developers a lot easier. If any changes are made to the data representation, the metadata maintained by the DBMS would automatically be modified and the DBMS would persevere to render data to application programs in the usual manner. "Hence, unlike previous databases the DBMS handles the task of transformation of data wherever necessary" (Gopal Gupta, Advantages Of Using A DBMS). The independence provided by the DBMS between the program and the data is referred to as data independence."
Abstract This paper looks at cash management techniques and short-term financing within an organization and explores both options, with a comprehensive analysis of various techniques and methods. There is also an overview of the relative advantageous and disadvantages of the methodologies employed within each categorization.
From the Paper "Cash management techniques have become important as financial managers try to accurately monitor risk and exposure, and use policies for improved decision-making. Similarly, methods of short-term financing have gained much needed use, as organizations, try to utilize financing options and increase the overall efficiency of organizations. This paper will explore both options, with a comprehensive analysis of the various cash management techniques, and methods of short-term financing. There will also be an overview of the relative advantageous and disadvantages of the methodologies employed within each categorization."
Abstract This paper examines the issue of foreign tax credit for corporations under IRC section 901(b)(1). The paper first explains foreign direct investment in order that we may understand the relevant issues. The paper then gets into the specifics regarding tax credits and issues where these foreign investment companies are concerned.
Outline:
Chapter One - Introduction
Chapter Two - Review of Case and Ruling Issues
Chapter Three - Methodology
Chapter Four - Case and Ruling Analysis
Chapter Five - Summary, Conclusions, and Recommendations
From the Paper "The first limitation that is important to note is that there is so little information about the case study subject in question - the foreign tax credit. While there is indeed some information, much of it comes from laws and rulings as opposed to studies and research articles. With that in mind it is important to note where the information that is being collected for the study of this issue is coming from. There is no reason not to use the information that is provided by others, but making sure that one is aware of where it comes from and what potential consequences that could have is of utmost importance when it comes to looking at the limitations that can be found in research. Making sure that the most accurate data available is used is significant and when something cannot be verified it should be pointed out in the study that it cannot be verified so that there is no further confusion as to whether that piece of information is legitimate or not for the study."
Abstract The paper addresses the current problems with the Lawrence Sports company's approach to capital management. The paper examines the issues and opportunities involved and presents an optimal solution for the company. The paper includes tables that illustrate the information provided.
Outline:
Introduction
Issue and Opportunity Identification
Stakeholder Perspectives and Ethical Dilemmas
Problem Definition
End State
Alternatives and Benchmarking Validation
Risk Assessment and Mitigation
Optimal Solution
Implementation Plan
Evaluation
From the Paper "An effective capital management plan is needed in order to ensure that the company is able to sufficiently address its operational needs, exploit it growth prospects, and meet its current liabilities (McClure, 2003). Without adequate cash flows, Lawrence will be unable to pay its suppliers, which will ultimately negatively impact on its business relationships, thereby cutting off supplies of necessary raw materials and souring growth prospects dependent on those suppliers. Conversely, if Lawrence borrowed excessively to meet liabilities, and then sales slowed, the company could ultimately fail to pay long term and short term debts."
Abstract This document discusses the marketing strategy of Metro Credit Union (MCU) and its options, focusing on issues such as branding, brand identity and positioning in a competitive environment. MCU is concerned about which market segments to pursue and how to pursue the one it targets. The paper concludes that MCU should pursue a technologically savvy and able online brand identity.
