All companies can implement a series of strategies that allow them to apply Finance from the corporate area. To do this work, they need to have a trained professional. This is why SNHU has the perfect Master's degree for this purpose.
In order for companies to obtain economic resources from the acquisition, financing and management of investments, they must necessarily apply various strategies that are part of Corporate Finance. With this, they will have the opportunity to develop productive projects, maintain their operation and grow.
How to apply Corporate Finance?
In the book Corporate Finance (2017), the Spanish economist Salvador Durbán Oliva explains that to apply this discipline, two basic concepts must be considered: real assets and financial assets. The former are the goods and rights—furniture, infrastructure, equipment, patents and brands—that are investments by companies. The latter are the documents—titles, loans or shares—that indicate the ownership of real assets.
Considering the real and financial assets of the organization, it is possible to carry out a series of actions that allow applying Corporate Finance with an informed perspective . Therefore, it is necessary to include various procedures to give continuity to the business, such as those described below:
Compliance management
Companies must establish rules to stimulate their financial activities, which directly affect the operating environment. This is achieved by addressing debts and customer obligations, as a strategy to optimize constant income. In this way, the possibility of having low liquidity can be reduced.
Valuation of investments
The main objective is to reduce risk and ensure profitability in operations. To cpa email list make good investment decisions , the company must be evaluated to know what it is looking for, through the analysis of debts and models to create value with investment projects, as well as internal and external risk analyses, among others.
Evaluating profitability
It is essential to pay attention to sales projections, investment, costs and expenses, and monthly cash flow. With this, the financial and economic viability of the company can be assessed, to ensure its balance and return on investment. To achieve this, processes, products or services that do not provide advantages are eliminated or restructured.
Risk management
The aim of this activity is to measure risks, developing and applying strategies that allow them to be managed. It focuses on what can be covered through the financial instruments exchanged, such as interest rates, exchange rates and share prices. Risk management is very important for intervention in the Treasury area.
Management of liabilities and assets
Assets (properties, rights and inventory) that can be invested to generate cash flow must be properly managed, as well as liabilities (obligations and debts) that must be covered in a timely manner. In this way, a broad view of the financial risks of investments, internal movements and the market is obtained.
Using leverage
It is essential for Corporate Finance to have the techniques that allow multiplying profits through leverage . This strategy can be carried out by borrowing money, buying fixed assets or using derivatives, which means a change in income to obtain better benefits.