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FINANCIAL MANAGEMENT

List six major factors that distinguish financial management in firms operating entirely within a single country from those that operate in several different countries. What are some of the common barriers to entry for a firm entering a new country for business? How does this vary from country to country.

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Some of the major differences that distinguish financial management in multinational firms versus firms operating in single country are:

1) Financial managers in multinational firms have to handle receipts and disbursements in multiple currencies and thus have to constantly deal with the issues related to exchange rate fluctuations. Such exchange rate considerations are not present in financial management of domestic firms. Multinational firm's financial managers need to pursue hedging strategies to mitigate the risks arising due to such transactions in multiple currencies.

2) Financial managers in multinational firms have to study international laws ...

Solution Summary

List six major factors that distinguish financial management in firms operating entirely within a single country from those that operate in several different countries. What are some of the common barriers to entry for a firm entering a new country for business? How does this vary from country to country.

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