Introduction A Conceptual framework is important to financial reporting. Financial reports provide information that is useful for present and potential equity investors‚ lenders and other creditors in making decisions in their capacity as capital providers. Hutchison-Whampoa Limited (HWL) is a global business company with long history. It is important for HWL to prepare the annual report as a basis of linking the conceptual framework in order to provide most useful information to satisfy the users
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how shareholders‚ managers‚ and even bondholders interpret their respective relationships to an organization. While they may share some common goals and objectives‚ there is the potential for at least some objectives to emerge that are focused more on individual enrichment than on the well-being of the whole. For example‚ managers may be more focused on building a reputation for themselves‚ possibly creating their own power bases within the structure of the larger organizations. Shareholders may
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1.0 Introduction of Agency Theory The specific definition of the theory based on the sources investorword.com and investopedia.com defined that the agency theory is a theory explaining the relationship between principals such as shareholders and agents. It is essentially involves the cost and way of resolving the conflicts between the principals and agents and change the something slightly to the correct position and decision related to the two group of conflict. Thus‚ the main objective of agency
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on the quality and effectiveness of corporate governance in European listed companies. Motivation for study Most of corporate governance research only reveals that corporate governance can solute the agency conflicts between management and shareholders which fails to identify principle-principle agency conflicts and their influences on corporate governance. Research question Whether more severe principal-principal conflict is relevant with weaker corporate governance and whether the severity
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History The concept of a corporate personality traces its roots to Roman Law and found its way to the American colonies through the British. After gaining independence‚ the states‚ not the federal government‚ assumed authority over corporations. Although corporations initially served only limited purposes‚ the Industrial Revolution spurred their development. The corporation became the ideal way to run a large enterprise‚ combining centralized control and direction with moderate investments by a
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Board balance. 2.1.5 2.1.6 2.1.7 2.1.8 Appointments to the Board. Multiple directorships. Re-election of Directors. Resignation of Directors. 2.2 Role of Chairman and Chief Executive. 2.3 Shareholders. 469 2.3.1 Approval of major decisions by Shareholders. 2.3.2 Annual General Meetings. 2.4 Accountability and Audit. 2.4.1 2.4.2 2.4.3 2.4.4 2.5 Annual Reports and Accounts. Internal Control. Independent Auditors. Relationship with Auditors. General
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is used to by financial economists to form very imperative feature of how assets markets function. Yet‚ shareholders get a better considerate of market by being conscious of the insights of agency theory. One primarily imperative group issue is the divergence between the interests of shareholders and debtors. In particular‚ the further risky but higher payback policies benefit the shareholders to the loss of the debtors. CAUSE OF THE AGENCY PROBLEM Finance theory assumed with the aim of
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This article was published in a slightly different form as Chapter 10 of Joint Ventures in Europe‚ Tottel Publishing‚ 2008. Joint Ventures in the Russian Federation Hermann Schmitt White & Case‚ Moscow 1 Hermann Schmitt Partner 1 General background 1.1 Joint ventures under Russian law Russian law currently does not provide a specific definition of ‘joint ventures’.2 In broad terms‚ a joint venture is a structure involving two or more independent entities that decide to work together
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investments. It shows net income as percentage of shareholder equity. Formula The formula to calculate return on equity is: ROE = Annual Net Income Average Stockholders’ Equity Net income is the after tax income whereas average shareholders’ equity is calculated by dividing the sum of shareholders’ equity at the beginning and at the end of the year by 2. The net income figure is obtained from income statement and the shareholders’ equity is found on balance sheet. You will need year
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corporate executive is an employee of the shareholders‚ and therefore only “responsible to his employers.” The corporate executive has primary responsibility to his employers to conduct business as they see fit‚ and manage the business to create the most profit while following the “basic rules of the society”. It is then seen that the corporate executive is acting as a “public employee‚” while serving shareholders and should be directed by those shareholders how to spend their money. However‚ Friedman
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