I need help in determining what factors should be considered when determining the most favorable financial structure for a global business? Can you please give me some examples. Also, I need to know how unethical behavior contributes to global business failures?© BrainMass Inc. brainmass.com October 9, 2019, 5:23 pm ad1c9bdddf
Interesting and somewhat complex questions, indeed. Please see my response attached for complete response (some fo which is presented below), as well as one supporting article. I hope this helps and take care.
1. I need help in determining what factors should be considered when determining the most favorable financial structure for a global business? Can you please give me some examples?
Is this a research project or essay question? This is indeed a complex question and not even the experts agree on what determines the most favorable financial or corporate structure for any business, including a global business. Therefore, I located two articles that deal with this controversial issue for you to read to draw on. There are examples of the kinds of considerations that a manager would need to consider when setting up the financial structure (i.e., corporate leverage and financial ratios, debt ratios, agency cost, and the likes) for a global business. For example, when considering how much debt would give the corporation leverage, things such as tax advantages of debt would be considered, etc. Some business owners, for example, are risk taker, while other are not, so these personal preferences will also impact the financial and corporate structure of the business. The amount of cash flow will also impact the financial structure, for example, How much money and resources does the company have at start-up? Multiple channel financing is often recommended for global businesses, for example. It gives the company leverage.
Once these decisions have been made, the financial structure is represented by the right side of a firm's balance sheet, detailing how its assets are financed, including debt and equity issues ...
By example, this solution explains some the factors that should be considered when determining the most favorable financial structure for a global business, as well as how unethical behavior contributes to global business failures. Supplemented with two artilces about capital and financial structures and decisions.