Nevertheless, large number of corporate executives prefer market timing theory rather the other two methods while making their financing decisions. Graham and Harvey (2001) stated that the situation of stock whether it is overvalued or undervalued is extremely importance for a firm when they want take consideration in issuing equity. Furthermore, there are difference between the market timing theory and pecking order theory. It difference is in term of market movement and efficiency. While investor is making their capital structure choices, market timing theory become the most importance theory to consider compare to the other two theories.
The paper on Corporate Governance and business morals gives information on worldwide advancement on corporate administration in the corporate world. Corporate governance is a basic to the presence of an organization. Company Secretaries assumes an imperative part in light of the fact that they control and direct the organization to accomplish world class Corporate Governance. Through Corporate Governance, a corporate society of straightforwardness, responsibility and divulgence is kept up. Good Corporate Governance serves to decrease corporate dangers and embarrassments.
To make the future secure for the individuals investing wisely is very essential. The collection of investment tools such as stocks, shares, bonds, mutual funds, cash etc., which depends on the income, budget, and time frame which is more convenient for the investors, is called a portfolio. The portfolio management is nothing but an art of selecting the investment policy which is right for the individuals in terms of maximum returns and minimum risk. Under the guidance of the portfolio managers who are experts to manage money of individual refers to a portfolio management. The active portfolio management and passive portfolio management are two main investment strategies that can generate a very good returns based on the investment accounts.
3.1. Pros of fair value accounting Timely information Since fair value accounting utilizes information specific for the time and current market conditions, it attempts to provide the most relevant estimates possible. It has a great informative value for a firm itself and encourages prompt corrective actions. It provides an accurate valuation This method of accounting helps to provide more accuracy when it comes to current valuations from assets and liabilities. If prices are expected to increase or decrease, then the valuation can do the same.
Therefore, a manager should align his/her objective to broad objective of organization and achieve a tradeoff between risk and return while making a decision; keeping in mind the ultimate goal of financial management i.e. to maximize the wealth of its current
CORPORATE GOVERNANCE Corporate Governance is referred as the process through which power of a corporation is exercised to manage the corporation’s total portfolio of assets and resources for maintaining and increasing shareholder value and satisfy stakeholders of the company. Corporate governance expresses the relationship, structure of rules, and process by which authority controls inner corporations. It encloses the mechanism, in which companies and the people be held to account. The good corporate governance enhances the shareholder morale which is very crucial. It gives the guidelines of how to control the business so that it can achieve its goals as well as also profitable to its shareholder for a long time.
According to him (Claydon, 2011), managers actually has a ﬁduciary relationship to stakeholders, who are any internal or external parties can affect or is affected by the organization’s operations. The reason given is that stakeholders hold a stake to the firm so they must be able to participate in the development of the company the board who manages the company has to bring them benefits. According to Freeman, there are two convincing reasons to support the notion of stakeholders. First, from legal perspective, beside shareholders, other groups can also have a stake in the corporation since there are legally contracts existing between corporation and those parties, such as suppliers, employers, customers. Even surrounding community and environment condition are also considered affecting or being affected to that organization’s activities.
Definition of Corporate Governance The corporate governance is the set of rules, principles and procedures governing the structure and functioning of the governing bodies of a company. In particular, establishes the relationships between the board , the board of directors , shareholders and other stakeholders, and stipulates the rules by which the decision - making process on the company for value creation is governed. In recent years, specifically following the onset of the financial crisis, the international community has understood the importance of the listed companies are managed properly and transparently. The good corporate governance is the basis for the functioning of markets, as it increases credibility, stability and helps to boost
8. It ensures strong foundation in ethics management and enforcing codes of conduct creates the ideal framework for the implementation of the same. The Corporate Governance framework outlines the commitment to each of the stakeholders, including the communities in which they operate, and it is their guiding light when they are sometimes faced with business predicaments that leave them at ethical crossroads. The structure is also dynamic in that it has been intermittently revitalized in order to remain contemporary and contextual to the changes in law and regulations. However, it remains intact at its
It is all about the management of a companies impact on its stakeholders, the environment, and the community in which it operates. Its more than just a philanthropic activity for some charitable causes. It is about the integrity with which a company governs itself, how it fulfills its mission, the values it has, what it wants to stand for, and how it engages with transparency. Here, the corporations have to move beyond the financial bottom-line to the social and environmental