Strategic Financial Management

Strategic Financial Management

Contents
INTRODUCTION.....................................................................................................................................3
MAIN BODY.............................................................................................................................................3
Task 1......................................................................................................................................................3
Task 2......................................................................................................................................................6
CONCLUSION........................................................................................................................................12
REFRENCES...........................................................................................................................................13

INTRODUCTION
The term strategic financial management can be understood as a form of study which involves
not only controlling the value of a firm, but also managing them with the aim of meeting the
aims and objectives of the organizations and price stabilization value over time (Delkhosh and
Mousavi, 2016). This is about producing market profit and achieving an adequate return on
investment (ROI). Financial control is characterized by company financial strategies, the
development of accounting policies and the making of financial decisions. The report is based on
two companies named Tesco plc and Benedict Corporation. Under the report stakeholder
analysis of Tesco plc has been done while in second part of report financial performance of
Benedict Corporation is done by help of various kinds of ratios.
MAIN BODY
Task 1
a) Explains the term ‘stakeholder’ and identifies three types of stakeholder of Tesco
Stakeholder: A stakeholder is an entity who has a stake in a corporation and may either control
the company or be influenced by it (Kumar, 2017). Its owners, personnel, clients, and vendors
are the key stakeholders of a particular company. However, the term has been expanded to cover
societies, states, and labor associations, with growing commitment to corporate social
responsibility.
Stakeholders may be intrinsic to an entity or extrinsic to it. Individuals whose participation in a
business comes from a direct interaction, such as work, ownership, or expenditure, are internal
stakeholders. External partners are people that do not deal for a firm directly but somehow are
influenced by the company's actions and performance. All external parties are known to be
vendors, creditors, and civic groups.
In accordance of annual report of Tesco plc, this can be inferred that there is both types of
stakeholders including internal and external. Tesco's key stakeholders are consumers, vendors,
creditors, opponents, parties, local governments, and the government. Tesco works with
hundreds of manufacturers and producers in order to serve consumers with high quality,

nutritious and organic goods. These producers and distributors not only provide Tesco with the
quality goods needed, but they also help the business minimize food waste. Below some key
stakeholders are explained which are as follows:
Customers: These are the main stakeholders of a company as they have an ability to affect their
performance. Customers are considered as external stakeholders because they do not have their
own interest in company’s policies and plans (Trinh and Thao, 2017). Though, customers can be
affected due to change in company’s strategies and plans. This is so because if a company makes
change in their prices than customers can be affected can change their purchasing habits. In the
context of Tesco company, this can be inferred that their sales in year 2016 has been dropped by
few volumes which indicates that customers might shifted their interest towards other company.
As well as Tesco might have changed their policies and plans which may lead to lower sales and
customer diversion.
Government: The government is also a main stakeholder as they can affect to company’s
performance by changing own policies and plans. It is essential for companies to follow
regulations and guidelines of government. In addition to this government collects tax from the
companies on a regular basis. The government of United Kingdom is a key stakeholder of Tesco
plc. This is so because they have ability to impact financial performance of such company. The
effect of government can be measured by help of amount of tax paid during an accounting
period. From annual report this can be stated that they have paid tax on profit after tax but in year
2016 they paid less amount of tax due to lack of income in such year.
Employee- Workers are important internal stakeholders. Employees have substantial financial
and time commitments in the company and play a specific role in the organization's policy,
tactics, and activities. These stakeholders are key person of many firms, also recognized as
lenders, and have a monetary stake in a business's performance. They offer the business
resources and the capacity to perform and even expand by their stake in the company. So, the
stake of a shareholder in a corporation is financial, but not all investors are involved. In the
context of above Tesco plc this can be inferred that there are a range of employees in their
operations and activities which play a significant role.