I-Corporate Governance-4 Flashcards
1
Q
Define: Corporate Governance
Principles of Coporate Governance 特点
A
a system of internal controls and procedures
by which individual companies are managed
- do not mandate, or even promote adoption of single corporate goverance regime, only serve as a framework that can be adopted
2
Q
Stakeholder groups
各自关注点
- creditors
- managers & employees
- customers
- suppliers
- gov/regulators
A
- creditors: CFO to cover repayment
- managers: company’s viability
- customers: company’s stability, less concerned by financial performance
- suppliers: CF for 应付账款
- gov: interests of the general public
3
Q
conflict of interest between
- shareholder/management, DoB 5
- controlling/minority shareholder 2
- shareholder/creditor
- customer/supplier
- shareholder/gov
A
- 1.management seek maximizing personal benefits. 2.risk tolerance: 股东更高，管理层保位置i。3, information asymmetry. 4. board influnenced by insiders. 5. director favor certain shareholder than other
- straight voting/ culmulative voting. 2. multiple class structure
- risk tolerance
- 对顾客赊销太多linient credit sale, 欠供应商账款
- avoid tax burden. 2. banks prefer lower equity capital base, regulators require higher
4
Q
stakeholder management
几种infrastructure
A
- legal
- contractual (公司自己可控)
- organizational (internal systems)
- governmental
5
Q
- AGM (annual general meeting)讨论事项 5
- EGM (extraordinary general meeting)讨论事项 3
A
- performance 2. 选董事会 3. approve financial statements 4. 选external auditors 5. 确定董事高管薪酬
- amendment to company bylaws 2. M&A 3. sale significant asset or business
6
Q
【say on pay】
- 内涵
- 分类
- criticism
A
- shareholders vote on 高管薪酬
- non-mandatory: Canada
- mandatory, non-binding: US, France
- binding: UK, China
- board is better suited to determin remuneration matters
7
Q
名词解释
- ESOP
- staggered board
- stranded assets
A
- Employee stock ownership plans
- board members 分三轮换届
- carbon-intensive assets that are at risk of no longer being economically viable because of changes in regulation
8
Q
Board of Directors
具体职责6
A
- 任命高管
- review财报，确保准确
- review审计报告from internal, external, committee,并跟踪改进
- ultimage responsibility: implement governance principles, laws, regulations
- ensure risk management system in place
9
Q
BoD
- 两种duty
- 两种tier
A
- duty of care: due diligence and care
- duty of loyalty: act in the interest of company and shareholders
- one tier: 同时包含高管和non-executive （英美）
- two-tier: supervisory board (non-executive,最高)和executive board (欧洲，中国)
10
Q
committee的职责
- audit committee
- governance committee
- remuneration/compensation 4
- nomination
- 额外要求
A
- 推荐external auditor及薪酬
- 监督implementation of governance principle, annual evaluation of the board
- a. propose remuneration policy, b. handle manager contract, c. performance criteria, evaluation, d. company HR policy
- 选择潜在director，维持board composiiton
- 审计、薪酬委员会必须由independent director担任
11
Q
影响stakeholder relations因素
market factors 3
A
- shareholder engagement 有好处
- shareholder activism 对冲基金
- competition and takeovers: proxy contest, tender offer, hostile takeover
12
Q
影响stakeholder relations因素
non-market factors 3
A
- legal environment: common law system: 绝对保护股东权益，civil law system要弱一些。此外，creditors easier to seek remedies in court
- media: 推动公司治理改革，让股东有更多渠道和管理层竞争发声
- corporate governance industry
13
Q
辨析：
straight voting
culmulative voting
A
straight voting: 【statutory voting】70% and 30% 各出5，3个董事会候选人。5人都得70票，3人都得30
culmulative voting: 70%总共350票，30%总共150票
14
Q
名词解释
- sell-out rights
- clawback provision
A
- Sell-out rights protect minority shareholders in acquisition situations by forcing acquirers to buy out minority shareholders at a fair price, even if those shareholders initially voted against the acquirer’s offer.
- clawback provisions allow companies to recover executive remuneration under certain circumstances, to the benefit of all shareholders
15
Q
5种ESG implementation approaches
A
- negative screening (exclusionary)
- positive screening (best-in-class)
- ESG integration into traditional analysis
- thematic investing
- impact investing
16
Q
Capital Budgeting
process 4步
A
- generating ideas
- analysing individual proposals
- planning the capital budget
- monitoring and post-auditing
17
Q
post-auditing
之意义3
A
- monitor performance,找出与forcast不同之原因
- improve business operation, 修正到forecast轨道上
- give ideas to future investments: 哪里更profitable
18
Q
5categories of
capital projects
A
- replacement projects: 替换/维持现有的，或换性能更好的以降低成本
- expansion project:扩大现有产能
- new products/ services: 新业务
- (mandatory) regulation, safety, environmental
- other: CEO pet project,以及无法用一般方法来分析的。
19
Q
6 Priciples of
capital budgeting
A
- based on CF not accounting concepts; CF is not equal to net income
- timing of CF is crucial
- consider CF after tax
- consider opportunity costs (incremental CF)
- should be excluded in capital budgeting: sunk cost, financing costs
- should be included: externatilty: negative (Cannibalizaiton)/positive
20
Q
3 types of project interactions
A
- independent/mutually exlusive projects
- project sequencing
- unlimited funds/ capital rationing
21
Q
6 project evaluation criteria
A
- NPV
- IRR
- Pay back period PBP
- discounted payback period DBP
- average accoungting rate of return AAR
- profitability index PI
22
Q
NPV rule
advantage 2
disadvantage 1
A
- 直接add value to the firm (rather than to creditors)
- realistic discount rate
- project size ignored
23
Q
IRR rule
advantage 2
problem 2
小结论1
A
- 直接reflect profitability
- comparable between different size
- assume reinvestment at IRR rate - unrealistic
- No IRR or multiple IRR
- multiple IRR:产生于non-conventional CF (符号变化多余1)，符号变化几次，就最多可能有几解
24
Q
【Payback Period】
- 算法
- 优势2
- 不足3
- 小结论1.
【discounted payback period】
- 优势2
- 不足2
- 小结论1
A
- 第三年还差200没收回，第三年CF+300，则2.67年
- simple/ indicate risk/liquidity
- 未考虑货币时间价值/payback period 之后的CF未考虑/ 无法indicate profitability
- 有时PBP能算出,但其实NPV为负
- 考虑了货币时间价值/risk,liquidity
- 依然未考虑payback period 之后的CF/ 无法indicate profitability
- 收回时间相较PBP更长
25
Q
average accounting rate of return
【AAR】
- 算法
- 优势1
- 不足3
A
- 按预测，按利润表列出每年NI。资产逐渐折旧完
ARR= avg NI/ avg book value
- 易懂易算
- based on accounting numbers not CF
为考虑时间价值
无明确判断标准
26
Q
Profitability index 【PI】
- 算法
- 优势
- 缺点
A
- PI= PV of all future CF/ initial CF outlay
=1+NPV/CF0-
- 可进行profitability 比较
- 不知道absolute amount
27
Q
NPV profile
- 纵截距/横截距代表？
- 斜率大说明？
- 计算crossover rate
A
- 纵：所有CF之和，横：IRR
- 说明大额现金流出现时间较晚
- 每一期CFA-CFB,形成一个类似新的project，计算IRR
28
Q
投资项目
impact on stock price 【in theory】
算法
A
NPV/outstanding common share
= Δstock price
29
Q
一个项目initial CF outlay
和future CF all double
NPV和IRR如何变化？
A
NPV：double
IRR：不变（成比增长）
