FINANCIAL MANAGEMENT

Financial Management of Highly Geared Companies

Abstract

The research paper contains the information about the financial management in the highly geared companies, and further, this paper elaborates the two of the companies of retail industry who coped in the crisis although their capital structure suggests that they are highly geared companies. This paper also discusses the some of the key ratios of the both companies.

Table of Contents

Abstractii

Introduction1

Research Question1

External defecate of United States2

Sector in Focus3

Gearing3

About Macy4

Product Mix Strategies6

Literature Review8

Credit Crisis and Highly Geared Companies8

Financial Crisis and Role of Geared Companies8

Market prosperity and Financial Crisis9

Bailout by US Government10

Environmental PESTAL analysis11

Hedging12

Financial Crisis and political issues13

Share price movement Kohl and MacyInc14

Stock price of Kohl Corporation14

Stock price of Macy Inc15

Strategic and Environmental Reasons17

Research Methodology18

Methodology18

Rationale for a Quantitative Study18

Philosophical Framework or Paradigm19

Strength and weakness of the mixed research19

Research Design20

Literature Search21

Instrument for data collection21

Reliability/Dependability21

Validity22

Ethical Considerations22

Discussion and Results23

Discussion23

Recession and Coping abilities of Highly Geared companies23

Results and Analysis25

Strategic reasons for change in ratios33

Cash Flow34

Strategic and environmental Reasons of Cash Flow34

Cash Flow Analysis of Kohl and Macy35

Cash flow for Kohl35

Cash flow for Macy Inc.37

Conclusion39

References40

Appendices43

Kohl financials43

Macy Inc Financials53

Questioniare68

PESTAL ANALYSIS69

Introduction

The powerful Democratic senators introduced Stop Tax Haven Abuse Act to help stop what they claim to $ 100 billion is lost to offshore tax abuses. Among its provisions, the Treasury secretary, foreign jurisdictions or financial institutions that impede U.S. tax enforcement will have the right to pursue. It also penalties on tax shelter promoters and 150 percent of any ill-gotten gains by increasing the maximum fine for tax evasion will be competent and strong. Looking at prospects, but Republicans are against tax increases any changes to the code can be construed as opposed to the MPs.

Research Question

What are the impacts of recession on the financial performance of the companies, having high ratio of debts in their capital structuring

These mood swings in currency and financial markets feel very force in the real economy, i.e. in production, employment, earnings and also, tax revenues. In general, the financial booms took place in a context of regulation and loose or partial supervision, and in general are characterized by a pro-cyclical bias. Importantly, the lack of regulation has not been smooth. In fact, for example, continued regulation of the systems banking, particularly in developed economies. It is known, however, this regulation is generally pro-cyclical bias, compounded with Basel II. However, the main problem consisted of three very sharp features.

Growing segments (Example, stock markets) or new (Example, funds international investment, hedge funds and derivatives markets)-which became constitute the predominant proportion of the financial markets - had weak or nonexistent regulations, these financial "innovations" involved a intense opacity. In the context of a long boom in these markets are difficult increasingly perceived risks that were piling up, including subsequently detected fraud.

This is compounded by the dominance of one approach neo-liberal macroeconomic markedly pro-cyclical, with strong exchange rate and monetary cycles (Takis, 2008, 67).

External defecate of United States

Two expressions were the huge external deficit of the United States, and arrears exchange recorded throughout Latin America since ...