Financial Risk Essay Example | Topics and Well Written Essays - 2250 words

Financial Risk - Essay Example Both companies have carried out work in Africa, Asia, Australia, the United States and other parts of Europe. The company operates from offices in the UK and Spain and focuses on the development of residential properties. In the UK the company operates from 24 regional offices across England, Scotland and Wales (Taylor Wimpey 2011b). Over the years, the company has built a wide range of properties from one and two-bedroom apartments to five bedroom detached houses. In addition to its UK and Spain construction business Taylor Wimpey also operates two other businesses - Prestoplan and Taylor Wimpey Logistics (TWL). Prestoplan is the company’s timber frame solutions business which allows for the simplification of on-site construction while TWL is its supply chain logistics business that sources materials in bulk from suppliers ‘just in time’ for carrying out construction (Taylor Wimpey 2011c). The industries in which Taylor Wimpey competes include residential constru ction contractors, the construction sector, and residential real estate development (Hovers 2011). The company’s main competitors are Bellway plc which is located in Newcastle Upon Tyne in the UK and The Berkeley Group Holdings plc in Cobham, Surrey. 2.0 Financing Decisions According to Edum-Fotwe et al (1995) the construction industry in the UK has always experienced a high level of insolvencies when compared to other industries. One of the main causes of this is the improper use of cash resources (Chen et al 2010). It is therefore important that regular performance evaluation be carried out in order to determine the strategies to use in order to ensure survival. Financial analysis using a number of ratios therefore becomes important. Liquidity and solvency ratios look at the ability of a firm to pay to meet short-term and longer-term financial commitments as they fall due (BPP 2009). Financing decisions will affect Taylor Wimpey’s financial risk 2.1 Financial risk Ac cording to Holton (2004) risk as it is commonly used refers to both exposure and uncertainty, neither of which can be defined operationally. There are many different types of risk. However, this paper looks at financial risk. Financial risk is the risk that is associated with debt financing. This synonymous with Gabriel and Baker (1980) definition which states that financial risk is ‘the added variability of the net cash flows of the owners of equity that results from the fixed financial obligation associated with debt financing and leasing.’ It also involves the ‘risk of cash insolvency’ and has been extended to include the risk of not being able to fill obligations in relation to prior claims with the cash that the business generates Gabriel and Baker (1980). A firm’s ability to meet its obligations is determined by the level of its fixed obligations as well as its liquid resources (Gabriel and Baker 1980). It is the risk that a company will not be able to meet its financial commitments due to insufficient cash flows. It is the additional risk that shareholders face when debt is used in addition to equity capital. Financial risk arises as a result of various transactions of a financial nature including legal transactions, new projects, mergers and acquisitions, debt financing, and through the activities of management, stakeholders and competitors (Horcher 2005). Financial risks are associated with both short-term and lon

African american essay Example | Topics and Well Written Essays - 1000 words

African american - Essay Example However, even though blacks had to go such conditions, the diverse African culture was still embroidered in their emotional state which remained apart of them as observed by Margaret Walker in her quotes, i.e. they still practice and held their norms from the past centuries to the present, avoiding the white culture despite the humiliating actions they were put through. This happened in the 1700 era where there was massive slave trade in the West African region. Millions of African descend were sold to the America and European countries. It was carried out in three parts hence the name Middle Passage. First, the Europeans carried goods such as firearms, iron, clothes and many more to the West African countries. On arrival, millions of people were captured and taken by force inform of slaves for exchange of goods. In fact, one of the slave narrates how her mother was forcefully taken and the only message she left that he be a good boy. The slaves were then shipped to America where the Europeans exchanged them for commodities such as sugar and cotton which were shipped to European countries. Captives were then left in America. Here they were exposed to various oppressions by the whites. First, whites had big tracks of land which were to be cultivated. The slaves were forced to work on those plantations producing crops while suffering severe tortures. Indeed they worked tirelessly on the plantations, with almost no food offered to them, while any complain would result into ruthless agony which caused them physical pain, castrating many deaths among the captives. This is shown from the slave narrative video where the slaves were subjected to thrashing while they were naked. The slaves were also made to bear inhuman housing conditions. Many people were put into small rooms. They had to excrete in containers provided to them in the rooms if not cubes, it was irritating and pathetic (Inikori and Stanley,