...increase the profitability of Scott Electronics PLS and to provide a greater dividend to shareholders. One reason to why shareholders may be pleased with the company’s financial performance in 2011 is due to the fact that the total dividends have increased from £1m in 2010 to £2m in 2011, which is shown in figure 3. The dividend per share measure the overall profit generated for each share in existence over a particular period. It simply looks at the dividend obtained from each share a shareholder owns. This is expressed in terms of the number of pence per share. This amount will normally be paid in two instalments. Using Appendix B I can calculate that the divined per share in 2010 was 20p and has increased by 100% to 40p in 2011. The dividend yield allows investors to see what percentage return they are getting from their investment. It also measures the proportion of earnings that are being retained by the business rather than distributes as dividends. Again using Appendix B I can calculate that the dividend yield in 2010 was 13.3% and in 2011 it increased by 50.3% to 20%. As both the dividend per share and dividend yield have increased shareholders will be making an increased profit which will not only encourage them to retain their profits back into the company, but it will also encourage them to continue supporting Scott Electronic Plc, and not look to buying shares in competitor’s such as Apple. In addition to this it will also make the shares at Scott Electronics more attractive...
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...Essay Maximizing shareholder value versus meeting the needs of all stakeholders. I did not grow up in New England and have only lived here for 10 years so Market Basket was relatively new to me. I certainly didn’t know about the higher wages and benefits the employees have enjoyed nor the family dynamics that operated within the company. It does seem odd that a company could have 2 cousins with the same first and last name wrestling for control of a multigenerational business, but truth can be stranger than fiction. After reading the article and watching the video, it reminded me that the Market Basket battle played out right here in our local community. In particular I remember going into the Market Basket in New Bedford last summer and seeing all the shelves barely stocked and speaking with a few employees about their fervent support of the ousted CEO. As an aside, we have many Market Basket employees that receive their medical care throughout the Southcoast system so I certain can see the interconnectivity between a corporation and the community. It’s been my experience that there are quite a few companies that do believe in meeting the needs of stakeholders and not just shareholder value. One in particular was Anheuser-Busch. When I lived in St. Louis, AB was an integral part of the community and its offices and original brewery anchored the southern section of the city. They paid higher wages, had generous benefits and even allotted 2 cases of beer per week to...
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...for some the Chinese Amazon has been in news these days for all good reasons. The e-commerce giant has introduced its IPO in NYSE with an offer price of $68.00 per share. The prices increased initially by 30% on the first day of trading taking the market value of the company to $230 billion. Based on the offering price the stocks of Alibaba sold at about 25 times higher than the estimated 2015 underwriter projection. After the first day’s raise the company will have to put its focus on the year on year growth. To meet the expectation of investors and analysts the company need to increase revenue by 30% to 35% annually for few years. Though it has been very eventful for the Chinese company as it becomes the fifth most valuable company after Apple ($614 billion), Google ($387 billion), Microsoft ($382 billion) and China Mobile ($259 billion). With the introduction of the IPO brought whole new sets of threats for US e-commerce giants. As we look behind 30 years ago, US companies held majority of the market share amongst Technology, Media and Telecom (TMT) companies. The American companies lost their ground in the course of 30 years to 66% where as from a negligible market share Chinese companies hold 10% of the total market today. The company profit dwarfs Amazon.com’s and eBay’s. It earning was around $1.35 billion between OctoberDecember, which is 100% higher YOY, and the first three quarter accounted $3.5 fiscal year, which ended in March. Amazon’s net income reported was $274 million...
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...Is CEO Power Bad? E. Han Kim and Yao Lu1 Abstract Recent evidence suggests that CEO power reduces shareholder value and the efficacy of incentive pay systems. To better understand how the power affects firm governance and performance, we decompose CEO power into three dimensions--structural, ability based, and ownership related. While structural power is indeed harmful--it is associated with higher managerial entrenchment, lower pay for performance sensitivity (PPS), and weaker firm performance--its impact on firm performance is benign when CEO power is restrained by strong external governance mechanisms. Concentration of ability based power in CEO appears to enhance firm performance, but only when external governance is strong. CEO share ownership (as independent variable) shows a U-shaped relation with entrenchment, and -shaped relations with PPS and performance. These results imply that ownership power arising at a high level of share ownership negates the beneficial effects of aligning CEO-shareholder interests through cash flow rights. November 10, 2008 JEL classification: G30, G34, J 33, L25, M52,G32, Keywords: CEO power, managerial entrenchment, Pay for Performance Sensitivity, Firm performance, Share ownership, CEO Centrality 1 Both are at Ross School of Business, University of Michigan, Ann Arbor, Michigan 48109. Email: ehkim@umich.edu and yaolu@umich.edu. We have benefitted from helpful comments and suggestions from Sugato Bhattacharyya, Amy Dittmar, Luo...
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...2011 Annual Report Notice of Annual Meeting and Proxy Statement We bring easy to your office. Staples is the world’s largest office products company and y a trusted source for office solutions. The company proy Revenue Mix2 2008 2007 2009 North American Delivery North American Retail vides products, services and expertise in office supplies, copy & print, technology, facilities and breakroom, and furniture. Staples invented the office superstore concept in 1986 and has annua sales Revenues ($B)1 2007 2008 2009 2010 2011 2010 2011 Diluted Earnings Per Share 3 in the world in eCommerce sales. With 88,000 associates worldwide, Staples operates in 26 countries throughout North and South America, Europe, Asia and Australia, making it easy for businesses y r of all sizes and consumers. f The company is headquartered outside Boston. More information about Staples (Nasdaq: SPLS) is available at www.staples.com/media. Cash Flow Generation ($M) of $25 billion, ranking second f Operating Cash Flow 2007 As Adjusted 2007 2008 2009 2010 2011 2008 2009 2010 2011 Free Cash Flow Capita Expenditures 2007 2008 2009 2010 2011 Stores Open at Fiscal Year End 2007 Dividends Per Share 2008 2009 2010 2011 1 2 2008 revenues include $4.2 billion of revenues from Corporate Express for the period July 2008–January 2009. f 2008 revenue mix includes $2.3 billion of North American Delivery...
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...Week #1 Checkpoint: Financial Management Goals Erica Brock Due Sunday Nov. 25, 2012 Nic Lane Financial Management refers to a rulebook which a business must follow to be accountable to their shareholders, stakeholders and the general public. See financial management is the essential because a big amount people can be affected by the unethical behaviors and the actions on a business. The employees deserves to know what’s going on in the upper management and with the company as a whole just in case in advance of potential but yet serious problems. The shareholders and the general public have to know to because the shareholders got to know what are going on with company and what they’re investing. Their money depends on its financial strength of the company. The general public has to know for the fact of the transactions of a public traded company, just in case if there is catastrophe, which they could be responsible for it bailing out of the company including with the taxpayers money. Economic status in company’s market place could include price earning ratios, the earnings per share, the price and cash ratios, book value per share, dividends yielding, market value per share and the marker and book ratios. The market value gives the management an ideal of what the company or firm investors thinks of their performance and future prospects. If a company’s ratios are good then the market value ratios can or should reflect on that and stock prices may go high. The increasing...
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...Question: FORD MOTOR COMPANY’S VALUE ENHANCEMENT PLAN (VEP) Q1. Vote in Favour or against of Ford Value Enhancement Plan? Vote in favour of ford’s Value enhancement plan for reasons discussed below: 1. Choice to Investor: It clearly gives the choice of investment and possible returns that could be obtained to the investors. They can make the choice for themselves depending future prospect of pay-out that they would prefer. 2. Share Advantage: For example if we take an investor has 100 shares in the company, if he would prefer to receive extra shares instead of a cash pay-out he would now have 174.8 shares in place of the 100 he initially had, an increase of almost 75% of shares owned by him. With the increase in the number of shares an investor owns, even though the share price will fall it gives the investor the advantage of selling a part of their shares for a more profitable investment and still a retain considerable number of the company shares. If the company were to conduct a share repurchase it would take considerable amount of time before all the shares could be bought back as the limit for daily repurchase is set at 25% of their volume. It could take up to almost a year by the time ford can repurchase the shares for $10 billion. So VEP adds value as they provide an option where they can repurchase a lesser percentage of their shares. 3. Pay-out Advantage: For an investor who would prefer to receive cash pay-out in place of receiving more shares, with the VEP he...
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...what method would be the best for financing of my business. Borrowing money from the bank, selling the supply, or licensing my product; are all selection I that are essential to be taken into to deliberate and examine prior to reaching the finalized conclusion. For the subsidy of my business, the best legal form of business I have decided upon, marketing stocks would be the finest for the corporation. In corporation stock is a minor portion of proprietorship. The proprietorship is divided into small portions are identified as shares. To establish how much of the business each individually shareholder maintains, shares are purchased and retailed to any person that wants it. If a company is doing well with the stock market, the cost of the share would be raised. If the business was not doing well, with their stock market, the cost of the share would drop significantly. Fundamentally, when shareholders possess more shares, clearly their profits will be increased as well as the quantity of significant administration judgments that would have to be constructed. With the absence of management understanding that I have,...
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...THE COMPANIES ACT, 2063 (2006) Date of Authentication: 2063.7.17.6 7 kartik 2063 ( 3 November 2006) 1. The Act Amending Some Nepal Acts, 2064 2064.5.9 (26 August 2007) ACT NO. 18 OF THE YEAR 2063 (2006) An Act made to amend and consolidate the law relating to companies Preamble: Whereas, it is expedient to amend and consolidate the law relating to companies in order to bring about dynamism in the economic development of the country by promoting investment in the industry, trade and business sectors through economic liberalization and make the incorporation, operation and administration of companies much easier, simpler and more transparent; Now, therefore, be it enacted by the House of Representatives in the First Year of the issuance of the Proclamation of the House of Representatives, 2063 (2006). Chapter 1 PRELIMINARY 1. Short title and commencement: (1) This act may be called as the “Companies Act, 2063(2006)”. (2) This Act shall be deemed to have come into force on 20 Ashwin 2063 (6 October 2006). 2. Definitions: In this Act, unless the subject or the context otherwise requires, (a) “Company” means a company incorporated under this Act. 1 (b) “Private company” means a private company incorporated under this Act. (c) “Public company” means a company other than a private company. (d) “Holding company” means a company-having control over a subsidiary company. (e) “Subsidiary company” means a company...
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...AC113-Accounting-Unit 3-Assignments Exercise 2-21 (pg.70 &71) Describe how each transaction of Lucent Technologies Inc. affect the three elements of the Accounting Equation Assets Liabilities Stock Holders Equity a Received Cash from issuing stock Increase in stock holder equity and increase in asset of cash b Made cash sale Increase in Asset of cash c Received cash from issuance of long term debt Increase in Asset of cash and Decreased Liability by paying debt d Paid research and development expenses for the current year Paid off a liability and decreased the asset of cash e Purchased machinery and equipment for cash Increased asset for owning equipment and decreased asset of cash f Received proceeds from selling a portion of manufacturing operations for a gain on a sale Decreased land asset with the sale increased cash asset with the sale gain may also decrease equity of stock g Paid off long term debt Decreased liability and could increase stock equity because of less debt h Paid employee pension expenses for the current year Increased a liability by paying the debt and decreasing asset i Paid taxes Decreased asset of cash and decreased liability by paying of debt j Paid Officers salaries Decreased asset of cash and decreased liability by paying of debt k Paid selling expenses Decreased asset of cash and decreased liability by paying of debt l Paid dividends Decreased asset of cash and...
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...dividend of $50,000 b) transfer of $50,000 from the general reserve to retained earnings c) payment of 100,000 bonus shares fully paid at $2 per share from retained earnings. 8. The equity of Master Shipping Ltd on 30 June 2009 consisted of: 280,000 ordinary shares, issued at $2.40 each, called to $2.40 $672,000 Calls in arrears (24,000 shares x 80c) ($19,200) The directors forfeited the shares on which the call was outstanding. The company’s constitution provides that forfeited shares cannot be reissued and that the balance of any forfeited amounts, net of reissue costs, must be refunded to the former shareholders. Refund cheques were sent to shareholders. Prepare journal entries to record a) forfeiture of shares b) refund of forfeited amounts to shareholders.(2 Marks) 9. Prepare journal entries to record the following related transactions of a public company. (3 marks) a) The company issued 40,000 options at 50 cents each to acquire shares at $5 each in this company b) The holders of 36,000 options then exercised their rights to acquire shares in the company. c) For the options not exercised, the company...
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...1. Identify the main stakeholder groups in your company. What claims do they place on the company? How is the company trying to satisfy chose claims? Dell has internal stakeholders’ are: employees, and customers. Dell external stakeholders’ are: suppliers, shareholders, government organizations and non-governmental organizations. Dell helps its employees by sponsoring women rights, gay and lesbian rights, and employees with disabilities. Customers needs are met by customizing products just for them. Suppliers get the best possible deals with Dell. Shareholders get profits. Government and non-government get the best prices for their computers. 2. Evaluate the performance of the CEO of your company from the perspective of (a) stockholders, (b) employees, (c) customers, and (d) suppliers. What does this evaluation tell you about the ability of the CEO and the priorities that he or she is committed to? The CEO, Michael Dell, is always trying to make things better for everyone. He tries to offer everyone the best possible solution. Of course not everyone can be satisfied at the same time. Employees, suppliers, and shareholders speak highly of him and the way he is running the business. If he did not, then employees would be suing him for one thing or another. Suppliers would cut him off, it would be news everywhere. The stakeholders would cash out. 3. Try to establish whether the governance mechanisms that operate in your company do a good job of aligning...
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...1 THE VEGA FOOD COMPANY In February 2007, Francisco Valle, Jr., president of Industrias La Vega, organized the first family council meeting in the owning family’s history to address problems he was having with his youngest sister, Mari, a shareholder in the company. He felt that the problems were not of his making and were interfering with his management of the company. Francisco, 45, had worked closely with his father, Francisco Sr., since 1986 and had become president of the company in March 2004, when his 72-year-old father was killed in an automobile accident. Industrias La Vega was a Spanish meat-processing business that produced hams, sausages, and other delicacies for domestic and export markets. The $104.8-million-a-year business was demanding, of course, but Francisco Jr. felt most challenged by the family conflicts that often overwhelmed him. The ownership structure of Industrias La Vega had been updated just months before the tragic accident involving Francisco Sr. At the request of Francisco Jr., who was concerned about the possible loss of control of the enterprise he had co-managed with his father for years, Francisco Sr. and his attorneys had created two classes of stock. The voting A shares did not pay dividends. The nonvoting but dividend-bearing B shares had a par value 10 times higher than that of the A shares. Except for brief stints, none of the Valle daughters had worked in the business prior to their father’s death. Ana, the second eldest daughter, was...
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...increased functionality and fun. Therefore, a large company like LG Electronics can have a great impact on the society and has many stakeholders. The internal ones include directors/managers, employees and shareholders. Suppliers, customers, NGO/ International organizations, community and local government are external stakeholders. Directors/managers Directors and managers are the ones that run the business. They aim to maximize their own benefits, such as higher salary and annual bonus. Thus, they try their best to improve the corporate values. Shareholders By the end of 2012, the number of shareholders of LG Electronics was 201,161. Shareholders are powerful stakeholders because they invest their money into the business. As the owners of the business, they aim to maximize the profit. They are hoping for a disclosure of transparent management information as well as more dividends. It is stated in the mission statement that the company wants to deliver innovative products. Without re-investing profit into the business, new products may not be invented. However, shareholders tend to share the profit immediately, which conflicts with the mission statement. LG Electronics communicate with the shareholders through different ways, including holding a general shareholders’ meeting, having a performance presentation and publishing a business report. Employees Another important internal stakeholder group is employees. As of December 31, 2012, LG Electronics has 86,697 employees...
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...3/7/2013 The conflict that arises from opposing sides on the topic of corporate responsibility programs is common amongst companies; when merging companies this struggle comes to the forefront of discussion in regards to altruistic programs. As this struggle arises one must take into consideration the effects on all stakeholders in a company. In the NYSEG case, NYSEG initiated a Customer Advocate system in order to assist those customers who suffer from hardships or are financially troubled beginning in the 1970s when energy prices skyrocketed (Arnold, 120). However, NYSEG recently merged with Energy East Corporation and their position on maintaining the program is unknown. The Customer Advocate system was created in response to catapulting energy costs by NYSEG. It was set up to aid customers and the local community, specifically those who were having trouble paying their bills or had unforeseen hardships such as lengthy illness, a serious work injury, or death of a wage-earner. NYSEG offers assistance to the client whether or not they believe they will retain him or her. The objective is to help them financially rehabilitate and prevent the shut off of their utilities (121). Additionally, NYSEG has created Project Share, a direct-financial grants program funded purely by NYSEG employees, retirees, and customers. NYSEG’s customer advocates who assist these customers in need conglomerate with other programs such as the American Red Cross Society, local churches, and social...
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