Egelsbach Private Investigations' Balanced Financial Scorecard

Starting a business, one may ask some questions to evaluate his or her ability to run a business successfully. An owner needs to question the finances, the challenges, the strengths, and weaknesses. First, the owners need to know finance: how much capital to startup business, what loans are available based on the business plan and financial statements, and how to keep up with profits and losses to determine the future of the business. Besides determining capital, the owners need to know what challenges they will face. Writing a well-executed business plan is the first challenge and important because it is a guideline to start business and to show lending institution or to attract investors for the business. Also, owners need to think who ideal customers are and who they can target to make a successful marketing strategy. Moreover, they have to think about their competitions because no business operates without competition whether it is direct or indirect. The competition has a significant impact on customer’s buying decisions. In order to compete with their competitors, they have to know their strengths and weaknesses: Are their products unique? Is the product better than the competitors’? Is the price

This step involves short and long term debt equity analysis. The proportion of equity capital depends on the possessing and additional funds will be raised. The choice of the source of funds the company has are the issue of shares and debentures, loans to be taken from banks and financial institutions and public deposits to be drawn in form of bonds. The choice will depend on relative merits and demerits of each source and period of financing. The management of the investment funds is key in allocating that the funds are going in the correct place. The profits that are made can be down in two ways dividend declaration which includes identifying the rate of dividends and retained profits in which the volume has to be decided which will depend upon expansion and diversification of the company. The management of cash is another important function. Cash is needed for all different aspects of the company such as payment of salaries, overhead and bills. All of these are important in a company and how successful the financial aspect is going to be.The financial management practices include capital structure decision, investment appraisal techniques, dividend policy, working capital management and financial performance assessment. A company needs to have well financial in order to be successful. “A company that sells well but has poor financial management can fail.” (Johnston)

The questions that follow and the article Comparing the Accuracy and Explainability of Dividend, Free Cash Flow, and Abnormal Earnings Equity Value Estimates will inform your completion of Milestone Three. An understanding of the models in this assignment will assist you in hypothesizing the incremental impact of a new investment project for the company. The understanding of these models will contribute to your ability to look toward the future when considering the direction of an organization. This activity is worth a total of 75 points. See the distribution of points listed before each question.

The decision making of management is very crucial and involves various analysis to be performed. There are various ratios and methods that can be useful for mitigating the risks and increasing the expected returns with investments. The financial forecast is a mix of the behaviour,

A long-term financial plan begins with strategy. Typically, the senior management team conducts an analysis of the markets in which the firm competes. Managers try to identify ways to protect and increase the firm’s competitive advantage in those markets. For example, the first priority of a firm that competes by achieving the lowest production cost in an industry might be to determine whether it should make additional investments in manufacturing facilities to achieve even greater production efficiencies. Of course, being the low-cost producer is difficult if the firm’s fixed assets are chronically underutilized. This type of firm therefore will spend a

The report recommends various strategies such as product differentiation to attract more customers and low costs strategy to decline the company costs of operations in order offer the company products at low prices. Despite the strategies that the company intends to implement to improve the financial conditions, new President will still need the support of Board of Directors to implement new strategies. The company will also need to improve the employee morale and management leadership skill to move the company forward. Despite the strategies to be implemented to improve the company financial conditions, the company still need to

Return on Equity has increase form 1.12% in 2015 to 6.33 percentage for 2016. Suggesting a management to a higher return equity, using the capital invested by shareholder

60 years ago, at the conclusion of the financial year, businesses who reported a profit were identified as an honorable business. This is not the case today, some successful businesses operate in the red, however, they have a strong mission statement that addresses their customers (internal and external), products or type of service they provide, a strategy identifying how they will grow and survive (Williams, 2008). Though for an organization to survive, they also must possess strong qualities within their mission and vision statement. This is key to ensure all vested parties have a clear understanding for the company’s existence and where the company is headed in the next 3 to 5 years. Make no mistake, a company who is thriving would

The objective of this work in writing is to develop a strategic plan with strategies and tactics to realize the strategic objectives, measures, and targets. Included will be marketing and information technology strategies and tactics. Three methods to monitor and control the strategic plan will be proposed and measures to advance organizational goals financially and operationally will be analyzed. Finally, actions will be recommended to address the ethical, legal, and regulatory issues faced by the organization and how corporate citizenship can be improved.

evaluated by the firm. Management is in charge of capital structure for a firm, therefor the decisions they

The dividends to Kennecott equal to the difference between Carborundum’s net income after adjustment and the profit retention. The methodology Kennecott’s management team used to determine the value of Carborundum to Kennecott was evaluated using an incorrect set of cash flows. First, it subtracted out the profit retention requirements needed to support Carborundum’s growth even though Kennecott would own the full equity in Carborundum, which is incorrect. Second, depending on the method used to value the company, the relevant set of cash flow is needed to be determined, either the free cash flow to the firm or the free cash flow to equity.

Our choices led to a constant increase in net income over the three years. Short term debt increase by approximately 100% percent but steadily reduced over the next three years. We were happy with the positive growth of the company and the fact that we were able to pay off most of the initial short term funding required by the increase in working capital requirement. Overall the current situation of the company in 2018 is good, although the total value created is less than 20% of that created in phase 1. From this we learned that the value of the firm can be significantly increased more through a reduction in working capital requirement than through increasing the firm’s sales and net income.

A short overview of the relevant data is composed in Appendix 4. The return on equity is very high, it had a large increase in the last three years, due to a higher increase of the net profits (x2.88) than the shareholders’ equity’s increase (x1.77) during the past three years. The management anticipates this in a proper way by investing in more assets, it emerges in a stable asset turnover and financial leverage. Appendix 5 gives a comprehensive operating management analysis.

The driving force behind a company’s financial success is the company’s ability to market itself. Marketing goes beyond selling of a product. It involves “building strong brands and a loyal customer base intangible asset that contributes to the value of a firm” (Kotler & Keller, 2012).

This section discusses the financial aspect of the marketing plan. We will consider break-even analysis, sales forecasts, expense forecast in order to meet the marketing strategy.