"Discuss Some Examples Of The Conflicts Of Interest That May Arise Between Bondholders And Stockholders When A Firm Is In Financial Distress" Essays and Research Papers

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Discuss Some Examples Of The Conflicts Of Interest That May Arise Between Bondholders And Stockholders When A Firm Is In Financial Distress

Agency Costs and Financial Decision-Making The Concept An agency relationship is a contract under which one or more persons (the principal(s)) engage another person (the agent) to perform some service on their behalf which involves delegating some decision making authority to the agent. If both parties to the relationship are utility maximizers and they may have divergent goals and objectives, and there is good reason to believe that the agent will not always act in the best interests of the principal...

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Financial Managers Need Only Concentrate on Meeting the Needs of Shareholders - No Other Group Matters

MANAGEMENT OF BUSINESS FINANCE- “Financial Managers need only concentrate on meeting the needs of shareholders - no other group matters” Discuss the above statement using practical examples to support you answer. Contents Page Introduction 1-2 Formulas: Profitability 2-3 Liquidity 4-5 Investment 5-6 Summary of Widgets Finical Ratios: Profitability 6-8 Liquidity 8-9 Investment 9-10 Conclusion 10 Bibliography ...

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Conflict Interest Case

Subject: Chief employee bonus: Conflict Interest. To: Ethics for Accountant From: Kyungwon Kwak Date: 03/07/2011 1. Ethics Case-Chief employee bonus The WGN Company has a bonus arrangement, which grants the financial vice president and other executives a $15,000 bonus if the net income exceeds the previous year's by $1,000,000. Noting that the current financial statements report an increase of $950,000 in the net income, Vice President Jack Brickhouse asks Louise Boudreau, the controller...

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conflicts of interest

There are many different definitions for Conflict of Interest, but most all mean the same or point to the same direction. When gifts, outside activities such as consulting, or financial and fiduciary interest have potential to create a certain decision or commitment with a business it is considered conflict of interest. Although there are numerous definitions the one adopted by the Institute of Medicine is helpful. It states, “A conflict of interest is a set of circumstances that creates a risk...

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Financial Distress

 Financial distress, reorganization and bankruptcy You are required to explore, study and investigate the issues of financial distress, reorganization and bankruptcy of firms around the world, in particularly Malaysia and examined the factors that may have caused this phenomenon. Search for journal articles (at least 10) that are related to these topics and provide your comments and opinions in your write-up, not more than 10 pages. Financial distress can be defined as situation in...

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Financial Management

FINANCIAL MANAGEMENT FOR NON-FINANCE MANAGERS Questions Exercise 1: This exercise is intended to make sure that we are all familiar with terms used debt financing. (10 points) (10) Fill the blanks by choosing the appropriate term from the following list: lease, funded, floating-rate, Eurobond, convertible, subordinated, call, sinking fund, prime rate, private placement, global bond, public issue, senior, unfunded, Eurodollar rate, warrant, debentures, term loan. a. Debt maturing in...

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Predicting a Firms Financial Distress

Predicting a Firm’s Financial Distress: The Merrill Lynch Co. Richard Hamilton Mike Rakes Brandon Sather Teresa Sexton Narrative: Merrill Lynch is financing the business through Cash provided by financing activities – the operating activities loss is offset by increases in long-term borrowings. 1. Evaluate the cash position at year-end Report Date 12/28/2007 12/29/2006 12/30/2005 Cash & cash equivalents 41,346,000 32,109,000 14,586,000 The cash position...

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Principals-Agents' Conflict of Interest

CORPORATE GOVERNANCE AND BUSINESS ETHICS ASSIGNMENT TOPIC: Principals (shareholders) – agent (managers) problem represents the conflict of interest between management and owners. For example, if shareholders cannot effectively monitor the managers’ behaviour, then managers may be tempted to use the firm’s assets for their own ends, all at the expenses of shareholders. Discuss the pros and cons of this statement with regard to duties of Board of Directors. Most organisations these...

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Corporate Governance and Financial Performance

GOVRERNANCE AND FINANCIAL PERFORMANCE CASE STUDY: ROOFINGS GROUP 1.0 INTRODUCTION Corporate governance is concerned with ways in which all parties interested in the well-being of the firm (the stakeholders) attempt to ensure that managers and other insiders take measures or adopt mechanisms that safeguard the interests of the stakeholders. Such measures are necessitated by the separation of ownership from management, an increasingly vital feature of the modern firm. A typical firm is characterized...

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ILM Understanding conflict manangement

ILM Unit 3.10 Understanding conflict management in the workplace . AC 1.1 Identify causes of conflict at work Causes of conflict in the work place can be due to various reasons, good examples of these would be Interdependence conflicts: This happens when a person relies on someone else’s co-operation on output or input in order for them to get there job done. An example of this would be if I was late getting a required weekly report on production performance to my boss on time which he...

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