Portfolio Activity Unit 6
The Portfolio entry should be a minimum of 250 words and not more than 750 words. Use APA citations and references if you use ideas from the readings or other sources. For this week’s portfolio activity, please advise the instructor of the following:
· Utilizing the information provided in your course textbook(s) or other valid sources, describe the role of the Financial Manager.
· In addition, explain the functions of money.
· Please provide a brief update to the instructor on how you feel you are doing so far this term.
This activity will be assessed using the
Written Assignment Unit 6
Instructions for submission
Submit a written paper which is at 2-3 pages in length, exclusive of the reference page. the Abstract is not required or needed. Papers must be double spaced in Times New Roman font which is no greater than 12 points in size. The paper should cite at least one additional (peer-reviewed) source independent of the textbooks.
In this paper, please discuss the following case study. In doing so, explain your approach to the problem, support your approach with references, and execute your approach. Provide an answer to the case study’s question with a recommendation.
A local family business is facing a dilemma. Dottie’s Grocery has been a landmark company in a small city located in the United States. Over the past 45 years, what began as a single fresh fruit and vegetable store, has now become a full-service grocery store chain with many stores throughout the city. Dottie’s is incorporated with only 7 shareholders, which are all family members. They are faced with a decision on how to raise much needed capital to maintain its current business operations and to allow the possibility of growth in the future. The family believes it needs an additional $23 million dollars. This sum is too large for a bank line of credit and no one in the family has additional funding to invest into the company. The family is considering other alternatives.
One alternative is to publicly issue debt (corporate bonds), the other alternative is to issue common stock to the public. Using your expertise in financial management, you have been asked by the management team of Dottie’s Grocery to conduct an analysis of the current situation and provide a summary of your recommendations. In your summary you must:
· Describe the process (in detail) of how a public offering occurs.
· A chronological account of how most public offerings would be an appropriate format, although not required.
· Discuss the impact and implications of each alternative.
· Explain how each alternative affects control over the company.
· As a small family business, the internal affairs and finances of the company were well guarded from the public view by the family.
· As a new IPO, how would the guarding of their finance change?
· What are the financial reporting effects of this decision?
· How will additional debt impact future earnings?
· How will new stockholders change the management of the company?
Superior papers will explain the following elements:
· Provide a narrative about the impact of issuing stock to the public. The narrative will include the topics of loss of control of the company and the requirements that future financial statements will be available to the public.
· Provide a narrative about the impact of issuing debt to the public. The narrative will include the topics of a potential loss of the company if debt covenants are breached and the requirements that future financial statements will be available to the public.
· Provide a narrative on the initial public offering (IPO) process using at least four research sources in addition to the textbook material. The narrative of the IPO process steps should include the:
· role of an investment banker
· deal negotiation
· preparation and submission to the SEC of the registration statement
· SEC approval
· setting an issue date
· setting an issue price
This assignment will be assessed using the
BUS 5111 Unit 6 Written Assignment rubric.
Discussion Forum Unit 6
In the discussion forum, you are expected to participate often and engage in deep levels of discourse. Please post your initial response as early as possible and continue to participate throughout the unit. You are required to post an initial response to the question/issue presented in the Forum and then respond to at least 3 of your classmates’ initial posts. You should also respond to anyone who has responded to you.
Your Discussion should be a minimum of 250 words in length and not more than 450 words. Please include a word count. Following the APA standard, use references and in-text citations for the textbook and any other sources.
For this week’s Discussion:
· Describe the Initial Public Offering (IPO) process in the USA to include critical events and points-in-time.