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Finance - global context - Coggle Diagram
Finance - global context
Tax
Paying Taxes
records
medium companies
small companies
taxes
mandatory contributions
Taxing Multinationals
Unitary taxation
simpler
country-by-country reporting
Arms length
record prices
hard to implement
tax avoidance
legal
Tax evasion
illegal
Multinational finances
choose where to store
choose where - record expenses
transfer miss-pricing
illegal
government loses tax revenue
transfer pricing
legal
choose currency
Balance of payments
current account
capital account
imbalance
large surplus
large deficit
financial account
Differing legislations
differences
priorities
circumstances
legal systems
Roman law
Common law
culture
IFRS
global accounting standards
comparible
high quality
missions
accountability
efficiency
transparency
Evolution of financial regulations
Financial organisations
The International Monetary Fund (IMF)
The World Bank
Financial reporting
Stewardship = simplest
1673 Savoury Ordonnance France
prevent bankruptcies
first
Industrial Revolution
changed size of average organisation
capital market function
legal requirement 20th century - UK
Borrwed finery
borrowing legislations
Imperialism
Transfer regulations across boarders
not evolved domestically = not adapted
Foreign exchange market
Foreign direct investment
FDI
financial assets bought + sold
PI
invest in other countries
foreign currency market
value - domestic currency increases
more purchasing power abroad
demand for foreign products
price elastic
spending - imports increases
price inelastic
spending- imports decreases
exchange rate
low = weak
high = strong
value compared to other currencies
SMEs trading internationally
difficult
exchange rates fluctuate
sterling depreciates / euro
good - exporters
bad - importers
increased costs
less competitive
SMEs rely - imported components
Global Financial Crisis
2016 -new requirements
local files
master file
country-by-country reports