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Assignment No.

1 For Financial Decision Making

Submitted To:
Mr.Faisal Mir

Submitted By:
Muhammad Ibrahim

Reg# SP-11-MBO-03 Date: 10/11/2011


Treasury Management
We can state that it is the management of cash, fund, currency, bank and financial risk. So, it is an imperative tool of finance. In this management, finance manager checks the cash inflow and outflow.

Functions of Treasury
The treasury department is responsible for the timely availability of those funds when needed for the support of the business the primary role is dealing with the management of a company's funds. Raising Equity capital and working capital Investing surplus funds

1) To Maintain The Liquidity Of Business

It is the main function of treasury management to maintain the liquidity of business. Without proper liquidity, it is risk for business to operate smoothly. By using cash flow analysis and working capital management. Treasury officer make good ratio of liquid assets and liquid liability.


To Minimize Currency Risk

It is the function of treasury management to minimize the currency risk. For this, treasury managers touch with currency market of world. They analyze the reason of crisis in currency market. Sometime this crisis will be benefited for companies because they have to pay less to other country for getting their service at cheap rates.

3) To Provide Quick Finance To Company

It is also function of treasury department to supply quick finance to company, it needs the money. For This, a good network in financial market is required.


Increasing Net Worth

This will require a detailed knowledge of a variety of areas of the company Key Will be an understand Of the overall business strategy this will be the foundation that sets the framework that Will drive the Treasury function

Business Organization Types

Sole Proprietorship
This is the simplest and the most widely used structure for business. It is the least regulated type of the various business structures a sole proprietorship is a business run by an individual. The owner is the business; the owner has all of the profits and losses of the business. The owner also has all the control and all the liability from the business operations. Business taxes are paid by the owner through his personal income tax return.

sole owner has total control over the operations of this business least regulated form of business other than records for tax purposes there are no legal requirements as to how the business must be operated usually one only needs to obtain a license or pay a fee to a local registering authority

Disadvantages All of the personal and business assets of the sole owner are at risk in the sole proprietorship A judgment against the sole proprietorship could reach into the personal assets of the sole owner
Liability insurance premiums are very high. Perhaps too costly for the resources of the sole owner Due to the structure it may be difficult to obtain a loan. if there is insufficient collateral a sole proprietor may have to mortgage a loan or place another piece of personal property as collateral

When the sole owner dies often the business ceases to exist due to the lack of structure in this
business form

A partnership is a business which operates like a sole proprietorship, but with several individuals running it. The partners share the profits/losses; have control and liability for business operations. Partnership taxes are paid by the partners on their personal tax returns, in proportion to their share of ownership.

Partnerships are relatively easy to establish. With more than one owner, the ability to raise funds may be increased, both because two or more partners may be able to contribute more funds Prospective employees may be attracted to the business if given the incentive to become a partner. A partnership may benefit from the combination of complimentary skills of two or more people. There is a wider pool of knowledge, skills and contacts. Partnerships can be cost-effective as each partner specializes in certain aspects of their business.

Partnerships are less strictly regulated than companies, in terms of the laws governing the

Disadvantages Business partners are jointly and individually liable for the actions of the other partners
Profits must be shared with others. You have to decide on how you value each others Since decisions are shared, disagreements can occur. A partnership is for the long term, time and skills ups. The partnership may have a limited life; it may end upon the withdrawal or death of a A partnership usually has limitations that keep it from becoming a large business. partner. and expectations and situations can change, which can lead to dramatic and traumatic split

A corporation is a business which is set up as a separate legal entity from its owners. The Board of Directors makes operational decisions. Owners are protected from liabilities of the corporation, and the corporation pays corporate income taxes. Corporations are more complex than either a partnership or sole proprietorship and are subject to more regulation by the state. The internal rules of the corporation which outline the mechanics of the operation and management are called the by-laws.

Advantages Potential for limited liability is one of the most important advantages of the corporate form of
business structure. The liability of corporate debt is generally limited to the amount of money each investor has invested.

A corporation can theoretically have perpetual existence. A shareholder may freely sell, trade or give away his stock unless this right is formally restricted
by corporate decision

Taxation can be both an advantage and a disadvantage. Disadvantages Due to the organizational structure in a corporation, a certain degree of individual control is
necessarily ;lost by incorporation

The technical formalities of corporation formation and operation must be strictly observed in
order for a business to reap the benefits of corporate existence.

The initial state fees that must be paid for registration of a corporation can be very high Corporations are also subject to a greater level of governmental regulation than any other type of
business entity.

Profits are subject to double taxation when distributed to shareholders in the form of dividends.

Who are stakeholders?

Stakeholders are often people who Will be impacted by the strategic plan Have information, experience, or insight that will be helpful in developing the plan May be in a position to either support or block progress of your plan Have a vested in interest in the work Are final decision makers or people who must approve the plan Will implement any aspect of the plan Need to be informed of the plan

Have been champions or critics of your work in the past

Are visionary thinkers interested in exploring bold, new opportunities Including creditors, customers, directors, employees, government (and its agencies, owners

(shareholders), suppliers, unions, and the community from which the business draws its resources.