财务管理专业英语3E教学课件作者刘媛媛 Topic 2.ppt

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1、2.1TypesofBusinessOrganization2.2CorporateStructureoftheCompany2.3ObjectivesofFinancialManagement2.4SeparationofOwnershipandControl2.5AgencyRelationshipsTypesofBusinessOrganizationSoleProprietorshipanunincorporatedbusinessownedbyonepersonPartnershipownedbytwoormoreindividuals

2、(calledpartners)Limitedpartnership——generalpartnerslimitedpartnersCorporationalegalentityseparatefromitsownersCorporateStructureoftheCompanyObjectivesofFinancialManagementStakeholderTheorymanagersshouldmakedecisionsthattakeintoaccounttheinterestsofallofafirm’sstakeholdersValu

3、eorWealthMaximizationtomaximizelong-termfirmvalueorwealthSeparationofOwnershipandControlTheentitywhichownsthecompany(shareholders)isoftennottheonethatcontrolsthecompany’sresources(management)SeparationofOwnershipandControlTheentitywhichownsthecompany(shareholders)isoftennotth

4、eonethatcontrolsthecompany’sresources(management)SeparationofOwnershipandControlFourmajordownsidesagencyproblemfree-ridingproblemincreasedcostsofinformationgathering.informationasymmetryAgencyRelationshipsAgencyproblemManagersmaywastecorporatecashandresourcesbyengaginginnega

5、tivenetpresentvalue(NPV)acquisitionsorinvestmentstosatisfytheirdesiretobuildanempire.Lessominous,butnolesscostly,managersmaysquandercorporatefundsonexcessivelylavishcorporateofficesandjets.Morerecentlymanagershavebeenknowntoincreaseshareprices(notvalue)byusing“creativeaccou

6、nting”,soastoexercisetheirstockoptions(e.g.Enron).AgencyRelationshipsAgencycostsarethetotalcostsresultingfromtheagencyproblem.managementtakesactionsthatnegativelyinfluencethewealthofshareholders,orwhen.theshareholdersmonitorthemanagement’sactionstoensurecompliance.Asdefined

7、byJensenandMeckling(1976),agencycostscomprisethefollowing:BondingcostsMonitoringcostsResidualcostsAgencyRelationshipsAgencycostsarethetotalcostsresultingfromtheagencyproblem.managementtakesactionsthatnegativelyinfluencethewealthofshareholders,orwhen.theshareholdersmonito

8、rthemanagement’sactionstoensurecompliance.AsdefinedbyJensenandMeckli