Reference no: EM132192336 , Length: word count : 2000

Module Overview: Adding Value Through Financial Practices

Businesses continue to look for ways to add value and attract consumers. Value can be developed in many forms; however, the cost of value must not outweigh its benefits. In other words, increasing the consumer's value must increase the company's profit-whether it is an increase in the market share or consumer loyalty. This module introduces some techniques and concepts you can apply to increase your business's value.

Financial management is one of the critical factors that contribute to a company's mission, whether the company is a for-profit or a nonprofit company. Financial performance is a constraint in every entity's decision-making process.

For a nonprofit company, financial performance is more about financial management-using money responsibly in the eyes of the funders, while meeting the clients' needs.

In a for-profit company, meeting the short- and long-term financial goals of investors is the baseline for having resources to execute the broader mission, whether that mission is to create the next generation of drugs to cure cancer, develop a toothpaste that prevents gingivitis, or create the next gambling game to entertain the patrons of a casino.

Throughout the course, you have discussed a variety of measures used to analyze the financial and nonfinancial aspects of an entity or a proposed investment. This module continues the discussion and evaluates what makes a business successful.

Like with many of the analysis measures discussed, it is best to look at the bigger picture instead of individual pieces. As you begin your assigned readings, consider how each component complements the other.

Module Readings:

Complete the following readings early in the module:

Module overview

From your course textbook, The portable MBA in finance and accounting, 4th, read the following chapter:

Global Finance

From the Internet, read:

World Inquiry's Innovation Bank

Module Conclusion:

When evaluating a company, the financial bottom line is not the only crucial element. It is important to also evaluate how the company interacts and engages with the community and its employees.

While it is important for a company to earn profit to maintain operations, there is a system of give-and-take that must be adhered to for establishing a balance between management and stakeholders. Without a proper balance, a company could lose its consumers' support, which would lead to loss of investors.

In this module's assignment, you will demonstrate an understanding of business as an agent of world benefit.

Module Assignment Overview:

Assignment: Risk Management Applications

Instructions: While there are many factors that lead to an organization's success or failure, it is important to identify the risk associated with the endeavor-financial or nonfinancial. Once the risks have been identified, management has a responsibility to develop measures to mitigate those risks.

Tasks:

Use the publicly-traded company you chose in Assignment Titled: Understanding the Numbers for Better Decisions and imagine it has made a strategic decision to start doing business in China. Using the discussion, Currency Exchange Rates: A Case in China with Country Risk, (Chapter 7, Global Finance, page 192 of your textbook) as a model for the report you will write, prepare a report in which you:

Develop a brief country risk assessment.

Determine the political, economic, social, and capital risks associated with doing business in China. What are the most important factors to consider? Why?

After years of keeping the Yuan pegged to the US dollar, in 2015 the Chinese allowed it to float freely in international currency exchange rate markets. You may read more about the Yuan reforms here.

Many economists believe that keeping the Yuan pegged to the US dollar has caused it to be undervalued by 30 to 50 percent.

Discuss what impact a revaluation of the Yuan might have on US multinationals doing business there, on China's exports, and on Chinese citizens' standard of living.

What impact would a revaluation have on Chinese inflation and on purchasing power parity? Explain.

Your paper should be about 2,000 words.

Your response should be thorough and address all components of the discussion question in detail, include citations of all sources, where needed, according to the APA Style, and demonstrate accurate spelling, grammar, and punctuation.