Patton-Fuller Community Hospital Essay

QUESTIONS1. What additional factors encountered in transnational as comp atomic number 18d with domestic fiscal heed? Discuss each briefly. transnational pecuniary management is faced with umpteen more(prenominal) barter factors than domestic pecuniary management. For instance, international product linees be requisite to operate in many distinguishable financial aspects around the world. International financial management essential(prenominal) deal with customers, sh atomic number 18h sr.ers, vendors, and tonic(prenominal) occupancyes cross federal agencys a much wider plane than domestic financial managers. Investment decisions regarding international issues whitethorn as well as be greatly affected by the exchange rate, taxes, and merchandise. It whitethorn also be more of a ch each(prenominal)(a)enge to manage financial records when directd in international trade. Additional differences include higher evaluate of return as well as the interest-rate parity theory (IRP).The IRP is the foregoing premium or discount that should be equal and opposite in size to the difference in the national interest rates. The exposure to the decline in quality of conflicting currency is also a serious factor regarding international financial management. An additional factor is the fact that many international subsidiaries may choose to work independently instead of for the multi-national participation. This would in turn arouse disastrous for the entire company. International companies permit much more price of admission to funds as they can seek credit and financing in other countries besides their own. Finally, financial managers have the opport unit of measurementy to call foreign enthronizations.2. What different types of championshipes operate in the international environment? Why argon the techniques and strategies avail competent to these firms different?thither are many types of businesses that operate in the international environme nt. Any business which participates in business transactions with other nations are part of the international environment. Any g overning body that is involved in imports and exports would definitely be involved. Aswell, any large firm that communicates periodical with dignitaries from other countries would also be involved in the international environment. These techniques and strategies may be different be work of these businesses gross domestic product. In addition, these arrangings advancements in technology, knowledge, and communication may lead to higher economic teaching therefore, the opportunity to participate in international trade and globalization.3. What is meant by arbitrage profits?Arbitrage profits involve investments with little to no risk. An investor makes arbitrage profits by get in one market with seamy currency, and then selling in some other market. This strategy does not involve an investment of funds or any risk bearing. However, the investor would st ill make a sure profit.4. What are the markets and mechanics involved in generating (a) fair arbitrage profitsSimple arbitrage involves two or more markets. This type of trading does not include exchange rates across all markets with a single currency. Instead, simple arbitrage is taking value of the differences in price regarding one asset.(b) and triangular arbitrage profits? angular arbitrage is the cultivate of converting one kind of currency to some other, then converting it to another currency, and the finally converting back to the original currency. Triangular arbitrage usually occurs indoors a short clock frame. Traders involved in triangular arbitrage would have to have advanced equipment and knowledge in order to efficaciously and quickly take advantage of this kind of trading.ReferencesKeown, A., Martin, J., Petty J., & Scott, D. (2005). Financial counsel Principles andApplications. Prentice Hall, Inc.Patton-Fuller participation HospitalOrganizations are constan tly timbreing for late ways to grow. A part of this includes budgeting and forecasting which prepares a corporation for its overture(prenominal) endeavors. Corporations explore options for growth and Patton-Fuller Community Hospital has discovered terce options for expanding their operations. (Apollo Group, Inc., 2010). These three options include going exoteric through an Initial public Offering, acquiring another organization in the healthcare sedulousness, and merging with another organization. This impel will appropriate the strengths, weaknesses, opportunities, and threats of the three options Patton-Fuller Community Hospital has.Going familiar through an Initial Public Offering ( initial public offering) has its advantages. For instance, creating currency that can be used to fund growth and generating liquidity for founders, investors and employees, among others (Benton, 2005). When an organization goes customary the largest touch on is creating shareholder wealt h therefore, choosing an initial offering provides the funds necessary to increase shareholder wealth.However, acquiring another organization in the healthcare industry may strengthen Patton-Fuller to increase the firms assets. According to Patton-Fullers 2008 financial statement (Apollo Group, Inc., 2010), the current ratio is 5.41 indicating that Patton-Fuller has $5.41 in current assets for every $1 in current liabilities. The healthcare industry is a costly business therefore this ratio could use improvement. get together Patton-Fuller with another organization provides benefits that this infirmary lacks. Patton-Fuller is current working on remodeling the hospital waiting area and has late solved an issue with the nursing staff. Merging with another organization could provide the assistance this hospitalrequires in the sense of satiateing its long-term goals as well as increasing its operating income return on investment which is currently at 12.3%.We will examine the weaknes ses of the three expansion options. There are many separates of going public through an IPO. The major disadvantage of going IPO is the cost and time involved in the transformation. Managers of efflorescence business people grow exhausted from dealing with attorneys, bankers, investors, accountants, etc. other disadvantage is going public gets very expensive. Fees are paid tabu for various things and to various people. Losing confidentiality, flexibility, and control is another disadvantage. The SEC requires that all public organizations release information ab come forth public affairs, profits, etc. Patton-Fuller has to decide if bad up their freedom is the direction they want to gear toward.Acquiring another organization in the same industry can have its disadvantages. wiz major disadvantage is the industry cosmos purchased having financial problems. This kind of organization is not worth the investment. The price to purchase may be a serious cost for a bad reason. Cost ch aracteristics can be another issue. Competitive problems are another issue. Everyone is trying to go afterward the same business. Some organization or cut throat concerning competition. If Patton-Fuller takes this route, they look at to make sure the industry macrocosm purchase is worth the investment. They do not need their investment to work for them.Merging with another organization another organization could definitely bring on some challenges. When merging, votes must be approved by the stockholders. Stockholders play a big spot in businesses merging. Obtaining the votes can be time consuming. Trying to get at least two-thirds or more votes is a task. There could also be conflict of objective between the two businesses. This could be a coarse problem. When the two businesses do not see eye to eye, this can cause disruption in spite of appearance the organization. Then there is always the notion of a business becoming besides large. When a merging business becomes too lar ge to quick, this leads to higher costs. When merging, Patton-Fuller need to do their research about the business they want to merger with. Merging with the wrong organization could be a risky task.Patton-Fuller needs to do their research and weigh their options about all three expansion options. Patton-Fuller need to think long-term and what would be sound to the hospital long-term.The Patton-Fuller Community Hospital has been serving its local community since 1975 except the executives at the hospital now believe it is time expand from being a privately and have three options for expansion going public through an IPO, acquiring another organization in the healthcare industry or merging with another organization. Opportunities of each address that could benefit the Patton-Fuller Community Hospital will be determined and discussed.When a privately held coming goes public, it usually means that the company is selling shares of its stock for the first time to the public. This means that a once privately held company now is owned by public stockholders. The change of going from a privately held company to a publicly held company would require a group of changes to the hospital more than likely there would be a change in management and a loss of flexibility. However, going public through an IPO may be the only way the hospital would be able to continue to grow and expand.For any business, going public requires a lot of time and resources to ensure that the process happens smoothly. It is often believed that a company should look for other alternatives such as securing venture capital, forming a limited fusion or examine their current capital before committing to an IPO resultant for expansion.Acquiring another healthcare company could be a good will acquisitions occur when two similar companies combine to form a new company altogether. The buyer of the other company takes control of the company because it is buying its shares this means that the company th e purchases the other company has full control over its assets and assumes all liabilities from the company that is being purchased. Acquiring another company within the healthcare industry would allow the Patton-Fuller Hospital to expand within the community. period acquisitions occur when one company buys another company and establishes itself as the proprietor of bothcompanies, a merger is the result of two companies that agree to move forward together merely continue to be owned and operated separately. Merging is often a good idea for a lot of companies because it allows companies to founder together for both organizations best interests to occur. Mergers allow businesses to dominate within their industries but allow them to each be individually owned and operated.There are threats associated with going public through an IPO. One threat is that there is a loss of control. If Wall Street analysts dont like the way the company is being run, your stock price may suffer, which m eans unsaid work has gone to waste. The board of directors may not like the transmission line youre doing, so your job is in jeopardy. And, of course, the shareholders may vote opposition to your opinion, which could significantly affect your life, explains Harry S. Raphael, partner of Raphael and Raphael, LLP, a Boston-based full-service accounting and business consulting firm. The threat of losing control of an organization will run the risk of losing the organization.Also, Public companies have a greater accountability for their actions and must also meet stringent requirements from the Securities and Exchange Commission (SEC) that cause innumerable distractions to the management team. At the same time, steady growth is expected on a quarter-by-quarter basis. If the expectations are not met, there is a chance of the company not being financed by lenders and therefore causing the company to go bankrupt.Lastly, going IPO presents a different kind of communication channel, both i nternal and external, which must be created and maintained. Much of this burden falls on the chief financial officer (CFO), but investor and public relations firms play significant roles in the operation and daily life of a public company, as well. such(prenominal) communications practices for public companies or those entrenched in the IPO process can be critical ( inferno No We Wont IPO, 2010).The purview of purchasing an ongoing business would appear to be a good idea however, there are possible issues to consider there is an livelyreputation, customer base, suppliers, equipment, leases and cash flow. The infrastructure and management team are also in propose. These facts will make it elusive for the business to soar if all mentioned is negative instead of positive. There is the possibility of the seller backing out just you get ready to sign the deal due to stirred attachments to the business. Their products may be inadequate and/or defective. The inventory is old and out dated. The business is on a downswing and experiencing a negative cash flow. Overall, it is difficult to find one good feature about the business, except the gross sales price. When this situation occurs, it is easier to start a new venture than purchase an old one (AllBusiness, 2010).Merging with another business, of the same kind, is also an option. However, there are threats to consider. The cooperation of the target firm existing management is almost a compulsion for a merger. This cooperation may not be easily or inexpensively obtained. Moreover, the diseconomies of scale if business become too large which leads to higher unit costs. Its also will create clashes of culture between different types of business. Thus this reduces the effectiveness of the integration. Merger also may be creating a conflict of objective between different businesses, meaning decisions are more difficult to make and causing disruption in running of the business. It also results dissatisfaction amon g current staffs as positions will be limited and the management have to decide which staffs to hold the position after the transaction has taken place (William, 2008).Patton-Fuller Community Hospital is a privately owned and has many options on how they can expand. Patton-Fuller now knows the strength, weaknesses, opportunities, and threats of the three expansion options. They have to determine what approach would best facilitate the hospital needs.ReferencesAllBusiness. Retrieved October 11, 2010 from http//www.allbusiness.com/specialty-businesses/minority-owned-businesses/459211-1.htmlApollo Group, Inc. (2010). Patton-Fuller Community Hospital. Retrieved on October 09, 2010, from https//ecampus.phoenix.edu/secure/aapd/cist/vop/ healthcare/PFCH/pfchHome.htmBenton, G. L. (2005). The Advantages and Disadvantages of Going Public. .IPO Planner, Guide and Resource Directory for Companies Going Public. Pillsbury Winthrop LLP. Retrieved on October 09, 2010, from http//ipoplanner.webzel.n et/forum/00000003.html.Hell No We Wont IPO, 2010. Retrieved October 11, 2010 from http//www.va-interactive.com/inbusiness/editorial/finance/ expressions/hellno.htmlWilliam, Peter The Advantages and Disadvantages of Mergers, November 15, 2008. RetrievedOctober 11, 2010 fromhttp//www.associatedcontent.com/article/1189676/the_advantages_and_disadvantages_of_pg2.html?cat=3