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Global Finances - Coggle Diagram
Global Finances
Financial
Reporting
Stewardship
Healthy Functioning
Economy
Provide Investor Information
Provides a basis for TAXATION
International Financial
Reporting Standards
Accountability
Efficiency
Transparency
Drive to achieve
fairer taxation and transparency
Different Rules in
different countries
Multinational
Companies
Foreign Direct
Investment
Innovative & provides choice
Very Powerful
Hires Lobbyists
Working against
unitary taxation
Avoids Taxes
Can choose where to...
Keep Cash
Store Currency
Affected by
Exchange Rates
Hold Expenses
Easier to do business
in some countries over others because there are …
Taxes
Public Bailouts
International
Tax Rates
Tax Evasion = ILLEGAL
Tax Avoidance = LEGAL
Transfer Pricing
Unitary Taxation
Make companies pay
fair share where they operate
Big Companies opposed
What is stopping it?
MNCs
vested interests
Institutional resistance
International
Finance Institutions
World Trade
Organisation
Trade things!
Sets trading rules
International
Monetary Fund
Financial Supports!
The World Bank
Get rid of Poverty!
Funds big projects
International
Payments
Balance of
Payments
Current Account
Imports
Exports
Money Transfers
Capital Account
Transfers of capital
Financial Account
Investments
Portfolio investments
Capital Investment
Establishment of facilities
Vertical Integration
Reserve Assets
Global Imbalances
Public/Private Sector Spending
Can lead to
Financial Crisis!
Surplus Countries
Deficit Countries
Foreign Exchange
Market
Exchange Rates
Fixed (by the government) exchange rate
Shifts in demand
Speculators
Foreign investors
Overseas
£
Supply to the
foreign market
Demand from abroad
Demand shift from overseas
Equilibrium = Floating Exchange Rate
Currencies can be
WEAK
Affects
Investment
MNCs turning up
STRONG
Price Elasticity
Lots of currencies