international finance

Specifically the following questions should be addressed within this part of the assessment:

· What proportion of the capital structure will come from debt or equity? Why?

· Will capital be raised locally or from head office? Why?

(1000 words for the two capital structure questions above)

· What are the working capital implications of the project? (500 words)

· What is an appropriate cost of capital for the project (this will provide your discount rate for part three of the assessment)?

· How was the cost of capital calculated? Explain your calculations. (500 words)

Part two of the assessment will therefore involve discussion and numerical analysis. You should decide upon the capital structure of your project in terms of proportions (%) and be able to evaluate and explain your decision. You should present clear calculations for your cost of capital along with an explanation and evaluation of your approach.

Total word limit = 2000 words. But for now you will 1500 only and the last part of calculation we do later after I get the information of how to do

So this assignment is all related to the project everything you write has to be related to the project so you have to focus on the project so you should find the project plz this report is the second part of the first one plz read the first one

In the introduction

· Talk about coca cola investing in the project

· Say that in this paper we will describes:

1. proportion vs capital structure (debt/equity)

2. whether capital is raised locally or head office? Choose from the original country USA

3. working capital implication

4. cost of capital for the project and how is calculated

5. and that you will provide calculations

1. Capital Structure considerations

Evaluation and explanation of your capital structure decision; what proportion (%, not in monetary amounts) of the capital structure will come from debt or equity? Why? Where will capital be raised from, locally or head office, or other? (1000 words)

Include: so for the proportion put more for debt than equity for example 60% debt 40% equity or 70% debt 30%equity more debt AND you should explain why you chose this propotion

· what is capital structure (use Shapiro as a reference ) or (Eitmen )

· how organisation finance projects to assure growth ( how Coca-Cola assure growth according to working capital implication )

· Coca-Cola ensures to invest in projects which assures security of funds at all the time

· Talk about equity finding ( what is ,advantages and disadvantages )

· Coca-Cola is stable so this allows assets to be used when financing (shareholders investing in your company that means lots of money to use which mean that you can use in your project)

· Coca-Cola ensures Assets to not go below % ?(find the percentage ( 5 years to show your evidence of research )

· Talk about Debt finding (what is , advantage and disadvantage )

· When cocacola Assumes to Borrow , must make sure to lenders that has Flow of Capital

· Talk about Bond rating (Standars&Poor’s)…..

· Debt long or short term (proportion) look at financial statements

As it has high bond rating , making it easier to access short term debt

· Short term bond of cocacola in % is ?

Highly risky if companies do not have good flow of Capital

· Capital Structure of Coca-cola is determined by DEBTS COMPARED TO TOTAL EQUITY,TOTAL CAPITAL AND TOTAL ASSETS OF COMPANY.

Therefore, Coca-Cola Capital Structure can also be found by long term Debt sof Companies in relation to equity and capital .

· Find the Ratio (look at financial statement ) what does that indicate

· Credibility of the firm is going to help to raise debt ensuring all project run well

INTERNATIONAL COMPLEXITIES ( how to reduce risk when its overseas ) please read

SHAPIRO chapter 14 THE COST OF CAPITAL FOR FOREIGN INVESTMENTS

To reduce exposure from losses, subsidiary can use borrowing in local currency.

· Political risk management , CURRENCY RISK MANAGEMENT , LEVERAGE AND FOREIGN TAX CREDITS IF YOU READ Shapiro YOU WILL NEED ONLY TO SUMMARISE IT IN FEW SENTENCES (CHECK SHAPIRO IN THE PICTURE PAGE 396-397)

35 mark SO ITS A LOT OF MARKS AND YOU NEED TO BE ALWAYS RELATED TO THE PROJECT (read the previous assignment so you know what is my project )always related to the project please in this part is 1000 words please put this information written in this 1000 words or 1050 is ok … must be relevant all to my project plus good references like shapiro or eitmen or many others good references

2. Working Capital Considerations

Consideration of the working capital implications relevant to your project and the potential international complexities

· Money to invest in the project

· How it’s find

· Working capital= total assets-total liability

Working capital is the difference, so you pay people , expenses and what is lets from the money you pay shareholders and invest in the project

· Find the working capital of Coca-Cola ( financial times )

· Working capital management what information what it helps

· So as Coca-Cola drink is over a lot of countries , so as results they will have a clear idea of how much to borrow

· Working capital days ( how many days for capital to be converted in profit )

· Higher working day capital what is going to affect

· Is defined by demographic

20 marks 500 words

3. An appropriate cost of capital 35 marks

Clearly presented, informed cost of capital calculations; clearly sourced data; an explanation and evaluation of your approach, including discussion of any assumptions made

This part im not sure about it as I didn’t get many information about it is 500 words you have to make the calculations and explain about them and provide financial statement in appendix . all related to the project

Don’t do this part until I tell you so do only the first 1500 words

4. Effective presentation; location and use of sources; evaluation of data and information

Ability to evaluate arguments, evidence and data

Ability to locate, extract and an analyse data from multiple sources, including acknowledgement and Harvard referencing of sources

10 marks