Corporate Financial Strategies : change in capital structure of companies

This assignment focuses on Corporate Financial Strategies. There is also an analysis of change in capital structure of companies. So, discuss the financial implications for the key stakeholders of the firm; for example, shareholders and creditors

Corporate Financial Strategies : change in capital structure of companies

Assignment,,Corporate Financial Strategies

Assignment question

Conduct a comprehensive evaluation of a recently reported corporate event

relating to the change in capital structure of companies

Learning outcomes assessed

In the report, you are expected to

·     Critically review the literature on issues examined in your analysis.Then,  apply Harvard referencing to the literature that you cite;

·     Discuss the background of the companies that you have chosen for your analysis with respect to their capital structure. The discussion should contain, at the least, a description of the capital structure adopted by the companies for 3-5 years and the market environment where the companies are operating. You may choose companies from any economy and market where company accounts data is readily available.

Corporate Financial Strategies : change in capital structure of companies

When evaluating the changes in capital structure, you will, but ar not limited to:

 1) assess the financial performance of the company before and after the changes took place by comparing financial ratios that measure the company’s operational performance;

2) discuss the financial implications for the key stakeholders of the firm. For example, shareholders and creditors;

 3) analyses and evaluate the reasons for these changes and discuss the pros and cons of such changes.

Corporate Financial Strategies : change in capital structure of companies

In your analyses, you are also expected to discuss the factors that may have influenced the changes in capital structure, such as the company’s characteristics; the characteristics of the industry in which the company operates; the functions of the financial sector (such as financial institutions and equity markets); market conditions prevailing surrounding the time of the changes, and macroeconomic policies, such as tax policy. In addition, you will need to conduct an analysis of cost of using retained capital in comparison to the cost of debt, cost of equity and average cost of capital, with those of other companies in the same industrial group, using graphs or charts.

Discuss how far your discussion is reflected in the most recent literature with respect to capital structure.

Detailed Instructions

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