2011年ACCA考试《F9财务管理》辅导讲义（31）

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2011年ACCA考试《F9财务管理》辅导讲义（31）

发表时间：2011/7/14 8:49:58 来源：互联网点击关注微信：

为了帮助考生系统的复习ACCA考试全面的了解2011年ACCA考试的相关重点，小编特编辑汇总了2011年ACCA考试辅导资料，希望对您参加本次考试有所帮助！！

Equity Finance

A detailed consideration of the different sources of equity finance is beyond the scope of this article and students are recommended to consult their textbooks or manuals for more detailed coverage. However, here are a few general points on the subject:

· For companies who already have shares in issue rights, issues are mandatory under company law. This means that any new shares have to be offered to existing shareholders in proportion to their existing holdings. This is to protect existing shareholders from the company selling shares to new investors at a low price and diluting the wealth of existing shareholders. This requirement may be overcome if existing shareholders are prepared to vote to ‘waive their pre-emption rights’.

· The current status of the company is important. Companies listed on the London International Stock Exchange or quoted on the Alternative Investment Market (AIM), can raise new equity finance by selling new shares on these markets by way of rights issues, offers for sale or placing. Other companies who lack access to the stock exchange find it more difficult to raise equity finance and may need to turn to venture capitalists if they require equity finance.

Debt Finance

Debt finance comes in many different forms. Students will find detailed descriptions in their textbooks and manuals. The major considerations in raising new debt finance are detailed below.

The duration of the loan

Generally, short-term borrowing (loans for less than one year) is cheaper than longer-term borrowing (loans for more than one year). This is because many lenders equate time with risk. The longer they lend for, the more risk is involved as more things can go wrong. Hence they charge a higher interest rate on longer-term lending than on short-term lending. However, short-term borrowing has a major disadvantage – renewal risk. Short-term loans have to be regularly renewed and the company carries the risk that lenders may refuse to extend further credit. This risk is at its highest on overdraft borrowing where the bank can call in the overdraft ‘on demand’. With long-term borrowing, as long as the borrower does not breach the debt covenants involved, the finance is assured for the duration of the loan.

In choosing between short-term and long-term borrowing, the firm should consider the textbook rule of thumb for prudent financing: ‘finance short-term investments with short-term funds and long-term investments with long-term funds’. Simply, this means use cheap short-term borrowing where it is safe to do so (investments that are short-term in nature and hence renewal risk is not a problem) but use long-term finance for long-lived investments.

Fixed v floating-rate borrowing

Many lenders offer the borrower the choice between a fixed rate of interest and one that floats (i.e. varies) with the general level of interest rates. Fixed-rate borrowing has the attraction of certainty (you know what interest rate you are going to pay) but on average is more expensive. This is because lenders see themselves as taking more risk on fixed-rate lending as they may lose out if interest rates increase. Generally, floating (variable) rate borrowing is cheaper, but it carries more risk to the borrower as interest payable may increase if interest rates rise. If a firm is already highly geared it may consider the risks of floating-rate borrowing too high.

The status of the company

Some types of debt finance are only available to large listed companies. Small companies are usually restricted to short-term borrowing. If long-term debt finance is available it is usually in the form of leasing, sale and leaseback, hire purchase or mortgage loans on property.

Currency of borrowing

It is important to remember that if a company borrows in a foreign currency it has to repay the loan and the interest in that currency. Currency fluctuations may add to the cost of the loan and increase the risk involved.

Debt Covenants

Borrowing money often entails certain obligations for the borrower over and above repaying the interest and principal. These are referred to as covenants. These include restrictions on the use of assets financed by the loan, restrictions on dividend payments and restrictions on further borrowing. Such covenants restrict the flexibility of the borrower and should be carefully considered before borrowing money.

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