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Finance for Business

Contents

Part 1: Introduction.

1.1 Short description of Financial markets trading practices and regulation in Australia.

1.2 Short description of financial market regulator in Australia.

1.3 Short description about ways of risk analysis and project evaluation.

Part 2: Research and Fact finding of Australian Financial Market

Comparison of three types of essential Businesses in Australia.

References.

Part 1: Introduction to 

The financial market of Australia is well developed which deals in various financial products. The largest market sector is foreign exchange market. The size of the debt market is relatively small on a global scale.

The purpose of this assignment is do a research and fact finding of Australian Financial Market, which is done by comparing 3 essential types of businesses in Australia in terms their owners, difficulty level involved in setting up the business, life of the business, nature of liability of owner, and level of difficulty involved in mobilizing funds and business transfer. It also does a fact finding of financial market trading practices and regulations in Australia and provides a short description of practices such as how dividends are declared, Record date, Ex dividend date etc.. The fact finding of financial market regulator, Australian Securities Investment Commission (ASIC) and describes its powers, role and whom it regulates. This assignment also provides a short description of ways of risk analysis and project evaluation.

1.1 Short Description of Financial Markets Trading Practices and Regulation in Australia

The following is the description of process of declaring dividends by companies and related terms

How are dividends released?

The companies pay dividend in order to reward the shareholders. While making an investment in the shares of a company, many investors take their decision on the basis of whether or not company pays dividend and what is size of those dividends.

Record date

This date is at as on 5:00 pm, when company’s register is closed in order to identify the shareholders that have entitlement to dividend. On this date, changes required in details pertaining to registration are to finalised .

Date payable

It is the date of the payment of dividend to shareholders.

Ex-dividend date

The ex-dividend date is day immediately preceding the record date. A shareholder is entitled to receive dividend if her or she has acquired the shares before the ex-dividend date. In case of acquisition of shares after that date, the prior owner of the shares has the entitlement to the dividend.

A company's share price usually moves up around as the ex-dividend date and starts falling after the ex-dividend date.

Trading reports

There are 7 types of trading reports listed in ASX 24 reports.

Also, there are different types of calculators available on ASX website for usage of investors and practitioners.

(Australian Stock Exchange, n.d.)

1.2 Short Description of Financial Market Regulator in Australia

The regulator for financial market in Australia is Australian Securities and Investment Commission (ASIC)

 The roles of ASIC under the ASIC Act are to:

  • manage, aid and boost the performance of the financial system and related entities
  • To ensure that investors and consumers rely on and do informed participation in the financial system

ASIC is a regulator for financial services and consumer credit, and authorised financial markets operating in Australia.

The powers of ASIC are to provide registration to financial service providers, issuing credit licences to financial service providers, to ensure the integrity of financial markets and to conduct investigation in cases of suspected breaches (Australian Securities and Investment Commission, n.d.).

1.3 Short Description About Ways of Risk Analysis and Project Evaluation

The strategic capital investment decisions are always crucial for any company. To decide whether to invest in a project requires careful consideration, as it may be subject to high level of various type of risks pertaining to finance, political events and market (Maria-Sanchez, 2005). These risks should be incorporated while doing project appraisal. These risks are considered by various by Capital investment decision methods, however each of them based on different factors and has its own limitations. Hence, a more precise method is required. One method, which can be developed is Net-present value at risk (Net present value at risk) .

In NPV method, future net cash inflows are restated to their present values and compared to initial investment. If NPV is positive, project is accepted and if it is negative, it is rejected. In the NPV-at-risk method, particular NPV is calculated that can be generated from the project at some confidence level, which is minimum expected NPV with the given confidence level.

Part 2: Research and Fact Finding of Australian Financial Market

Comparison of Three Types of Essential Businesses in Australia

Name of Business

Chadstone Shopping centre

Amcal

Coles Express

Owner/s of Business

Vicinity Centres

Sigma Healthcare

Coles Group

Level of difficulty in setting up the business

Difficult

 Medium

 High

Life of the business

Unlimited

Unlimited

Unlimited

Liabilities of owners over the business’s debts

Limited

Limited

 Limited

Legal status of business

Company

Company

Company

Level of difficulty in mobilizing funds

High

Medium

High

Level of difficulty in business transfer

High

Medium

High

  • Top of Form
  • Bottom of Form

References for Neuronal Risk Assessment System

Australian Securities and Investment Commission, n.d. www.asic.gov.au. [Online]
Available at: https://asic.gov.au/about-asic/
[Accessed 23 September 2020].

Australian Stock Exchange, n.d. www.asx.com.au. [Online]
Available at: https://www.asx.com.au/
[Accessed 23 September 2020].

Maria-Sanchez, P., 2005. Neuronal Risk Assessment System for Construction Projects. s.l.:Pearson.

Remember, at the center of any academic work, lies clarity and evidence. Should you need further assistance, do look up to our Accounting and Finance Assignment Help

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