PHAN TICH VAI TRO CỦA TAI CHINH DOANH NGHIỆP DANH GIA VAI TRO CỦA CFO TRONG DN Ở GIAI DOẠN KINH TẾ HIỆN NAY TABLE OF CONTENT TABLE OF CONTENT RESEARCH OF CONTENT PART 1: FOREWORD Role of corporate finance 1.1 Corporate Finance guarantee mobilization of capital for business operations as normal and continuous 1.2 Corporate Finance plays an important role in improving the business performance of enterprises .3 1.3 Corporate Finance is a very useful tool to control the business situation of enterprises Goal of corporate finance 2.1 Selection and investment decisions .4 2.2 Determining capital needs and capital raising organizations respond promptly and fully to the capital needs of the business activities 2.3 Use effective is the capital, strict management of revenues and expenditures and ensure the solvency of the business .5 2.4 Implementation of profit distribution, appropriation and use of corporate funds 2.5 Regular control the operations of the business 2.6 Implement the financial planning Role of the CFO (chief financial officer) in the enterprise The need of titles CFO (chief financial officer) of businesses in Vietnam PART 2: TEST LIST OF REFERENCES 17 RESEARCH OF CONTENT PART 1: FOREWORD Role of corporate finance Business is an economic organization has its own name, assets-based transactions and stable business registered under the provisions of law for the purpose of implementing the business - ie make a, some or all stages of the investment process, from production to sale of products or provision of services on the market for the purpose of profit Corporate Finance is understood as the relationship between business value to stakeholders in the economy Corporate Finance plays a very important role for the operation of the business and is expressed in the following main points: 1.1 Corporate Finance guarantee mobilization of capital for business operations as normal and continuous Monetary capital is a prerequisite for the operation of the business In the course of business activity generally raises short-term needs and long-term capital for business operations as well as for regular investment in the development of the business The lack of funds will make the operation of the business difficult or not implemented Therefore, to ensure that the operation of the business is conducted normally, constantly depend greatly on the organization's funding business finance The success or failure of the business activities of enterprises in large part be determined by the funding policy of raising capital or business 1.2 Corporate Finance plays an important role in improving the business performance of enterprises This role of corporate finance is shown in that: The decision-making right investment depends largely on the evaluation and selection of investment from a financial perspective Raising capital in time to help enterprises fully business opportunities seized Selection of form and methods appropriate to mobilize capital can reduce the cost of capital contributed greatly increase the profitability of the business Using leverage business and especially financial leverage is reasonable factors significantly increase margin equity Mobilizing the maximum amount of capital available to business operations can avoid damage due to capital accumulation, increased asset turnover, reducing the number of loans that reduce interest payments, contributed greatly increased interest Net profit of the business 1.3 Corporate Finance is a very useful tool to control the business situation of enterprises Business processes of the enterprise as well as the process of mobilization and morphological transformation of monetary capital Through the collection and spending money every day, the situation of the financial indicators and especially the financial statements can control time and overall operational aspects of the business, from which quickly out of existence and the untapped potential to make the appropriate decisions to adjust activities to achieve goals of the enterprise In the market economy, the role of corporate finance is becoming more and more important for the operation of the business Because of these reasons below: - The financial activities of enterprises involved and affect all business activities - Scale of the business and operational needs of capital for growing businesses On the other hand, the financial market is growing rapidly, the financial instruments to raise capital more abundant and diverse Therefore, capital mobilization decisions, investment decisions, etc, to the growing influence of the situation and the business performance of enterprises - The information about the financial situation is important base for business managers to control and direct the activities of the business Goal of corporate finance 2.1 Selection and investment decisions The prospect of a future business depends heavily on investment decisions for large-scale long-term investment decisions as technological innovation, business expansion, new product manufacturing,etc To go to investment decisions requires businesses to consider many aspects to consider on economic, technical and financial In particular, the financial consideration to capital expenditures for investments and investment income by bringing back In other words, considering the cash flow and the cash flow related to investments to assess investment opportunities financially It is the process of planning a budget estimate and evaluate the financial performance of the investment 2.2 Determining capital needs and capital raising organizations respond promptly and fully to the capital needs of the business activities All the activities of businesses require capital Corporate Finance to determine the capital requirements necessary for the operation of the business during the period (which implies long-term and short-term capital) Next, the organization must raise capital to meet the timely, complete and beneficial to the operation of the business To go to decide the form and method of raising capital appropriate, consideration should weigh on many aspects such as structural funds, the advantages of each form of capital raising costs for the use of each capital,etc, 2.3 Use effective is the capital, strict management of revenues and expenditures and ensure the solvency of the business Corporate Finance to find ways and means to mobilize the maximum amount of capital available to the business of business, freeing up the capital accumulation, closely monitoring and effective implementation of payment and withdrawal of money sales and other revenues, and closely managing all expenses incurred in the course of business operations Constantly seek measures to establish a balance between revenue and expenditure in cash, ensuring that businesses always have the ability to pay due debts 2.4 Implementation of profit distribution, appropriation and use of corporate funds Make a reasonable distribution of profit after tax, as well as setting up and using the funds of the enterprise good will contribute significantly to the development of enterprises, improve living standards and morale of the employees in the business career 2.5 Regular control the operations of the business Through the collection and spending money every day, the financial statements, the implementation of the financial indicators for monitoring the operational status of the business On the other hand, need to conduct periodic analysis of the financial situation of enterprises Through analysis, to assess the efficiency of capital use, strengths and weaknesses in management and predict the financial situation of enterprises From there to help leaders manage the business, making timely decisions appropriate to adjust business operations and finance Thus, corporate finance is considered to be one of the important tools to manage the business 2.6 Implement the financial planning The financial operations of enterprises should be scheduled in advance through financial planning There is good financial planning, enterprises can make appropriate financial decisions to achieve business goals The process of implementation of the financial plan is also actively processes offer effective solutions to market fluctuations Role of the CFO (chief financial officer) in the enterprise The chief financial officer (CFO), who manage the cash flow of the business, an important factor especially in the period of global economic crisis today As the blood vessels nourishing the body, the currency of the business to run continuously But to run in any direction, the speed of stars, big or small traffic is greatly dependent on the decision of the chief financial officer With the functions of financial management, the CFO should always closely monitor the path of the money flow, generate matrix rational, efficient use of capital At the same time, the CFO must also skills training "steering the ship" can control the flow with different speeds on each boat ramp to the quickest possible lapse safely To make this possible, the CFO should understand not only the importance of knowledge, training and skills required but also the tools needed to be sensitive analysis, judgment, given the proper orientation case They have turned the "Accounting Information System" to "Financial Information System" to analyze and handle financial relationships in business, building financial plans, exploitation and use effective capital and risk warning for businesses, offering a reliable prediction of the future The role of the CFO is expressed as a bridge between the financial markets now That role is expressed as follows: (1) First, the CFO will hold raising capital to meet the capital needs for production and business activities of enterprises Thus, CFO will have to forecast capital needs and choices necessary forms to mobilize capital with reasonable scale (2) After raising capital, financial director will perform the allocation of capital for the investment opportunities of the business In conditions of limited funding, CFO must allocate capital for investment projects that can maximize the benefits for owners (3) The investment and efficient use of assets with high efficiency will bring incremental cash flow for the business (4) Finally, CFO will have to decide the distribution of cash flow from operations of the business The cash flow that can be reinvested back now or reimburse investors Through the above analysis, we can see the CFO of a business can have an important role through the analysis and the choice of three fiscal policy strategy, namely: + Enterprise should invest in the project in terms of financial resources is limited to maximize the benefit of the owners? Answer this question ie selection policy has optimal capital investment + Enterprise should finance investment projects with public funding to scale how much? Answer this question means selected financing policy optimization + Distributed enterprise should operate business results like? The selection of the answer to this question is chose the profit distribution policy (dividend policy) optimization These policies will have an impact on the growth rate of income of the owner in the future and the impact it will increase or decrease the value of the company on the market The need of titles CFO (chief financial officer) of businesses in Vietnam In the context of economic difficulties at present, the role of the CFO is very important, it is who will advise on strategies for the Board of Directors based on the financial situation of the company and cash flow forecasts During these tough business, and many business leaders have chosen to "polish" or "falsified" the financial data, through accounting techniques of finance director So, in this context, many CFO have to stand in front of two choices, one's personal morality and community interests, the interests of the two businesses In many cases, to protect the enterprise, the chief financial officer to accept the wrong way, but they are suffering with this center Also, follow me, in Vietnam the concept CFO was new, and most of the companies in Vietnam, chief financial officer or chief accountants have the same role, but in fact, CFO is to advise the board in business strategy and take responsibility for their financial strategies proposed, only the chief accountant manage the financial situation of the company During this time the director of finance need to change, enhance his role, not only as managers of profit and loss numbers of businesses, which have seen circulation of cash flow , and how to reduce the financial cost to businesses overcome difficulties The most difficult of the CFO, not just the current business not easily acquire bad debts, or the inability to pay quickly, which is not a recognized leadership role in advising the them While, in many cases the projects have been implemented but the board did not calculate all the scenarios, the feasibility away,etc, Which sometimes lead to cash flow managed to keep the project stalled, wasteful enterprise, and the enterprise led to the bankruptcy or dissolution When the board has decided to invest, borrow, nobody consulted CFO but when problems occur or female doubtful debts liquidity is now chief financial officer shall be responsible for handling the reason, it is paradoxical in many companies today I think it must have another look at the CFO, based on the financial administration to set out the policy, strategy, corporate moves, in the debt structure, financial problems in investment projects, not only as they are the record numbers took place Yourself when choosing investment funds financed company is interested to see the company's chief financial officer or not So often in the company's CFO, financial management professional In fact, many companies are only interested in producing, not interested in the big issues such as cash flow, strategic financial risk management, this is very dangerous for the survival of the business, so the investment is also considered as capital here PART 2: TEST Please choose the most correct answer by circling on the correct answer that you have selected Template questions have only one correct answer INFORMATION BELOW (TABLE 1) USED FOR ANSWERS FROM QUESTION TO QUESTION Balance Sheet of the Smith Company Assets: Cash and securities marketable Receivables Inventories Prepaid expenses Total Current Assets Fixed assets Except: accumulated depreciation Net fixed assets Total Assets Liabilities: Short-term payables Negotiable instrument payables Tax accrual Total current liabilities Long-term debt Equity Total Long-term debt and Equity $300.000 2.215.000 1.837.500 24,000 $3.286.500 2.700.000 1.087.500 $1.612.500 $4.899.000 $240.000 825.000 42.500 $1.107.000 975.000 2.817.000 $4.899.000 Income Statement Net sales (sell on credit) Except: Cost of goods sold Selling expenses & General $6.375.000 4.312.500 administration expenses Depreciation expense Interest expense Income before tax Corporate income tax Income (profit) net Common stock dividends Income (profit) leave Based on the information in Table 1, the current rate is: A 2,97 B 1,46 C 2,11 D 2,23 1.387.500 135.000 127.000 $412.500 225.000 $187.500 $97.500 $90.000 Based on the information in Table 1, using 360 days / year average collecting money period: A 71 days B 84 days C 64 days D 125 days Based on the information in Table 1, the debt ratio (ratio of liabilities) is: A 0,70 B 0,20 C 0,74 D 0,42 Based on the information in Table 1, the net profit margin on sales equal how much: A 4,61% B 2,94% C 1,97% D 5,33% Based on the information in Table 1, the Inventory Turnover Ratio is: A 0,29 times B 2,35 times C 0,43 times D 3,47 times Which is type the following companiesno subjectload limited liability debt? A) Private Company B) Joint Stock Company C) Public company D) All the above answers are wrong Calculate the present value (PV) of $ 100,000 received after years from today, assuming an interest rate of 8% / year? A) $60.000,00 B) $68.058,32 C) $73.502,99 D) $82.609,42 Calculate the present value (PV) of $ 80,000 received after 10 years from today, assuming an interest rate of 5% / year? A) $38.422,76 B) $40.000,00 C) $49.113,06 D) $76.000,00 Calculate the present value (PV) of $ 50,000 received after 20 years from today, assuming an interest rate of 4% / year? A) $5.242,88 B) $10.000,00 C) $22 819,35 D) $40.000,00 10 Calculate future value (FV) of $ 60,000 in years, assuming the interest rate is 5% / year? A) $62.500,00 B) $72.674,86 C) $75.000,00 10 D) $76.576,89 11 The NPV method: A Is consistent with the goal of maximizing value for shareholders B Recognizing the value of money over time C Use cash flow D All the above answers are correct 12 The NPV method assumes cash flows are reinvested at the: A IRR B NPV C The rate of real income D Weighted Average Cost of Capital (WACC) 13 You are analyzing a proposed project and have the following information: Year Cash flow -$135.000 $ 28.600 $ 65.500 $ 71.900 Payback period required years Income ratio requirements 8,50% Net Present Value (NPV) of the proposed project is ? A $3.289,86 B $3.313,29 C $4.289,06 D $4.713,71 14 Calculate future value (FV) of $ 10,000 in years, assuming an interest rate of 10% / year? A) $16.212,78 B) $18.000,00 C) $18.756,22 D) $21.435,89 15 Calculate future value (FV) of $ 20,000 in years, assuming an interest rate of 12% / year? 11 A) $17.096,08 B) $28.292,66 C) $31.470,39 D) $32.020,64 16 If $ 15,000 is invested at interest rate of 10% / year, asked how long will the investment be doubled? A) 7,3 years B) 8,4 years C) 10,6 years D) 14,8 years 17 If the money is invested at 8% interest rate / year, asked approximately how many years the interest received will be equal to the original investment? A) years B) years C) years D) 12 years 18 Sara wants to have $ 500,000 in a savings account when she retired Ask how much she must have money in the account now if the interest rate is fixed at 8% / year, to make sure she will have $ 500,000 in 20 years? A) $107.274 B) $144.616 C) $180.884 D) $231.480 19 You are analyzing a proposed project and have the following information: Payback period required Income ratio requirements Year Cash Flow -$135.000 $ 28.600 $ 65.500 $ 71.900 years 8,50% The payback period using discounted cash flow of the project? 12 A 2,57 years B 2,64 years C 2,87 years D 2,94 years 20 Which of the following is not considered as equity in the balance sheet of the company? A Cash B Paid in capital C Preferred shares D Income leave (profit retention) E Ordinary shares 21 Calculated Yield To Maturity (YTM) of a 5-year bonds, $ 5,000 par value bond with a 4.5% interest rate and pay interest every months if coupon bond is priced at $ 4876? A) 4.30% B) 5.07% C) 6.30% D) 8.60% 22 Calculated Yield To Maturity (YTM) of a 10-year bonds, $ 1,000 par value bond with a 5.2 % interest rate and pay interest every months if coupon bond is priced at $ 884? A) 5.02% B) 6.23% C) 6.82% D) 12.46% 23 A bond have 3-year term, Par value of $ 2,000 and have 6.3% interest rate bonds with coupon rate paid annually (1 year payment times) Ask Yield To Maturity (YTM) by how much if the bond is priced $ 1,801? A) 6.30% B) 8.48% C) 9.22% D) 10.32% 13 24 /One bonds par value $ 1,000 bond with an interest rate of 5.4% / year and coupon interest paid every months, bonds have year term and Yield To Maturity (YTM) of 7.5% If interest rates rise and Yield To Maturity - YTM rise 7.8%, How are bond prices affected ? A) Decrease $9,82 B) Decrease $11,59 C) Increase $12,16 D) The price of the bond does not change 25 One bonds par value $ 5,000 bond with an interest rate of 6.4% / year and coupon interest paid every months, bonds have year term and Yield To Maturity (YTM) of 6.2 % If interest rates rise and Yield To Maturity - YTM rise 0.8%, How are bond prices affected ? A) Decrease $98,64 B) Increase $40,49 C) Increase $84,46 D) Increase $142,78 26 Calculated bond yields of bonds with a term of years, $ 10,000 par value of the coupon interest paid every months and the current price of the bond is $ 9,543.45, Yield To Maturity (YTM) 6.8%? A) 4,32% B) 5,60% C) 6,25% D) 8,44% 27 In Harry's birth, his father spent on $ 1,000 investment account committed paying interest of 4% / year Asked how much money Harry would be have when he is 18 years old? A) $1.720 B) $2.026 C) $2.804 D) $4.806 14 28) Helen's savings to start her business If she invested $ 10,000 in the account now, asked how much of the minimum interest rate is to make sure that she has $ 25,000 in her account in 10 years? A) 2,5% B) 6,4% C) 9,6% D) 10,2% 29 Consider the following chain of cash flows: | | | | | ? $5000 $6000 $7000 $8000 Year Cash Flow If the market interest rate at 8% / year, the present value (PV) of the cash flow chain will be approximately: A) $22.871 B) $21.211 C) $24.074 D) $26.000 30 Consider the following chain of cash flows: | | | | | $1000 $2000 $3000 $4000 ? Year Cash Flow If the market interest rate at 8% / year, the present value (PV) of the cash flow chain will be approximately: A) $11,699 B) $10,832 C) $12,635 D) $10,339 15 LIST OF REFERENCES 1) Curriculum Course in Corporate Finance, Associate Professor, Dr Nguyen Huu Anh, 2014 2) Financial Management business, Do Mai Thom, 2014 3) Financial Management, Phung Manh Lan, 2013 4) CFO Handbook, Nguyen Huu Toan, 2013 5) The director of financial instruments, Vo Thanh Ha, 2013 16 ... Income Statement Net sales (sell on credit) Except: Cost of goods sold Selling expenses & General $6.375.000 4.312.500 administration expenses Depreciation expense Interest expense Income before... money sales and other revenues, and closely managing all expenses incurred in the course of business operations Constantly seek measures to establish a balance between revenue and expenditure in... QUESTION TO QUESTION Balance Sheet of the Smith Company Assets: Cash and securities marketable Receivables Inventories Prepaid expenses Total Current Assets Fixed assets Except: accumulated depreciation