Economy Alliances

Posts Tagged ‘Finance’

The phrase performance or return on investment is related to one of the most important concepts in corporate finance.

Total assets employed in a business created the need for equivelente amount of funds that must be captured in financial markets. These funds must be paid at market rate.

Payment can only come from capital gains on the efficient use of assets. Relating these gains to the value of assets that generate them, we find the parameters of return on investment.

If these returns are equal to or greater than the cost of funds, then the business can be viable. However, if the return is lower, the business has no long-term future.

The value of the assets shown on the balance sheet and earnings are shown in the profit and loss account.

So, we relate the value of the profit and loss account with balance sheet value for profitability.

The concept of ROI is universal, but the measurement methods vary greatly. This lack of consistency causes confusion in the minds of many people, both the financial sector and other sectors.

The role of financial manager is growing steadily due to the need for companies to be more competitive financially, which leads them to seek advice on financial professionals to achieve better economic performance and creating value in the organization.

It is said that the financial objective of maximizing the value of the company, which should focus on the main functions of the organization’s key financial, investment, financing and dividend decisions.

But the question is how financial statements and indicators are efficient in generating critical information for the organization?

You could say that while financial indicators are useful, they require the proper interpretation and application by the financier in order to obtain information that can be used in decision-making, and to use new financial tools such as global indicators that further complement the source of information and fail to take action in pursuit of economic growth in the company.

The global market should question the future financial manager on the important role it plays in business and the business environment as well as the need to anticipate events that may affect the economic stability of the organization, in the case of financial projections , the financier must calculate the cost may be an erroneous projection in their sales or lack of liquidity in the organization to cover its cash disbursements and some major tax changes, fiscal and monetary might divert completely the projection made, it is important the financial watch out for the global economy and determine how the company can be affected to the changes in international markets and the effects on exchange rates, inflation and interest rates. Read the rest of this entry »

If the government meets, the announcement in 2011 to assess the Bolivian economy will suffer a negative impact in the short and medium term, especially in the field of exports, which become more expensive, they will lose competitiveness against other countries’ supply and therefore recorded a fall, exporters yesterday warned Bolivians.

Goran Vranicic, president of the Bolivian Chamber of Exporters (CANEB), said the purpose of government is facing a possible increase in inflation in the world, as explained by the Minister of Economy and Public Finance, Luis Arce, but the measure may backfire and create negative economic effects.

He explained that in the medium term, to appreciate the Bolivian imports would become cheaper for the direct benefit of domestic consumers but compete unfairly with domestic production, which seriously weakened its sales, shrink, therefore, investment and product active capacity to generate employment.

He said the government announcement comes amid registered trade confrontation between China and the United States, countries that are depreciating their currencies to make their products more competitive in world trade and to produce more and generate more employment in their own countries.

We would be among the few countries seeking cheaper imports that create jobs in the outside instead of promoting exports and create jobs in Bolivia for Bolivians, “said the representative of the CANEB.