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Efficient Financial Management | Assignment

   

Added on  2020-02-24

9 Pages2661 Words79 Views
Finance
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CORPORATE FINANCE
Efficient Financial Management | Assignment_1

Aveo groupContentsIntroduction.................................................................................................................................................2Goals of Aveo..............................................................................................................................................2Code of ethics, ethical theories, corporate social responsibility.................................................................3Aveo as an Investment................................................................................................................................4Causes of fluctuations in the share price and the volumes traded..............................................................5Conclusion...................................................................................................................................................7References...................................................................................................................................................82
Efficient Financial Management | Assignment_2

Aveo groupIntroductionEfficient financial management is the essence of an organization and this is the reason why financial management policies like capital management, dividend policy are given due recognition. In relation to Aveo Group, the policies implemented by it have assisted it to make a strong progress over the years. An analysis has been done to shed light on the goals of Aveo and whether the corporation should consider the influence of financial decision on sustainability and responsibility.Goals of Aveo Firstly, the Group intends to obtain continuity of flexibility and funding and for such purpose, it utilizes bank loans, overdraft facilities, finance leases, etc in addition to other sources of income. It also reviews its current lines of funding so that future requirements can be addressed. This allows the Group to enhance its flexibility by matching the profiles of cash flow requirements with that of short-term investments. Further, this also allows for timing the negotiation of variouscredit facilities (Bauer & Hann, 2010). This assists the Group in enhancing the efficacies of their social responsibility actions that is its main priority. Secondly, it recognizes the importance of management of capital and for such purpose; it ensures that a mix of funding options are utilized.Besides, this is done in alignment with the objective of maximizing shareholders’ returns. Further, it intends to maintain a capital structure that can assure a lowest available WACC (weighted average cost of capital). In relation to this, the Group attempts to maintain its gearing ratio in the range of ten and twenty percent. This can be proved by the fact that its gearing ratio was 17.4% in the year 2015. Moreover, in order to attain advantage from variations in the cost ofcapital, the Group may adjust such capital structure including variations in dividend payable to shareholders, adjusting the level of debts, etc (Damodaran, 2010). Thirdly, in order to ensure thatthe resources of the Group are not hampered, it ensures that customers who are willing to trade on credit terms are properly subjected to credit scrutinization processes including an evaluation of their financial position, regulation of industries, etc. Further, the Group also possesses a cash management policy that allows it to maintain liquid cash and other portfolio investments so that preservation of cash is done at all times (Melville, 2013). This can play a key role for the Group in the proper investment of resources for the attainment of prime goals and objectives (Bauer & 3
Efficient Financial Management | Assignment_3

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