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A selective, critical survey is provided of the academic literature on the financial management policy of multinational enterprises (MNEs). The focus of much of the current research is the two major themes of financial management policy in relation to the increasing volatility of real and financial asset prices in the international financial environment of MNEs; and international market segmentation. The main parts of the chapter discuss the enhanced importance of recent increases in asset price volatility, the classification and management of risk exposure, the management of financial risk by MNEs, and issues relating to the effective implementation of a risk management system within the governance structure of an MNE.

Macroeconomic stability and increased growth were achieved in the early 1990s despite very weak financial management and accountability systems. This chapter shows how these weaknesses became even more pronounced following the adoption of the 1995 Constitution, decentralization, expanding budgetary demands, and the requirements of the Poverty Eradication Acton Plan, among others. Strengthening public financial management and accountability was critical if progress was to be sustained and if donors were to be persuaded to channel more aid through government systems. Yet in 1998 the entire government had just two professional accountants. The chapter presents the key reforms adopted to strengthen financial management and accountability, looking at changes in the areas of the legal and policy framework, institutional capacity building, and processes and systems, particularly the introduction of the Integrated Financial Management System.

This chapter discusses the implementation of the budget, including the supervision of expenditure by numerous recipients of EU moneys. The presently applicable Financial Regulation (Council Regulation 1605/2002), emanating from a reform process established a new framework for financial management of Union programmes, including inter alia provisions on budget implementation methods. Article 53 stipulates that the budget can be implemented in a number of ways: on a centralized basis; through shared or decentralized management; and through joint management with international organizations. Centralized administration allows the Commission to implement the budget directly through its own departments or indirectly though limited delegation to third parties. Shared management involves delegation of implementational tasks to Member States, particularly in relation to the European Agricultural Guarantee Fund and the Structural Funds. In the case of decentralized management, tasks of implementation are delegated to third countries subject to the conditions laid down in Article 56 and Part Two, Title IV of the Financial Regulation. Where the budget is implemented by joint management, certain implementing tasks are delegated to international organizations, which have to provide, in their accounting, audit, internal control, and procurement procedures, standards which offer guarantees equivalent to internationally accepted standards.

Given the firm's objective with respect to shareholders and other stakeholders, it is naturally desirable that a risk management strategy is consistent with the objective. A firm's objective has several dimensions. It can be defined in terms of a target variable such as profit, economic value, shareholders' wealth, or book value. In addition, the time horizon must be made explicit. Risk attitude with respect to the target variable is a third dimension. Determination of a risk management strategy requires also that management takes a position with respect to financial market efficiency, the existence of risk premiums, purchasing power parity, and costs of adjusting operations. These costs determine the role of financial risk management relative to the adjustment of operations and pricing. Flexibility of operations is a real option. Four types of strategies for financial risk management are discussed in this chapter based on the management's risk attitude and perception of profit opportunities in financial markets; laissez-faire (do nothing), aggressive, minimize variance, and selective hedging. These strategies can be chosen for any target variable and time horizon. Choosing a strategy is, to a large extent, an information problem. Information requirements for selective hedging, in particular, can become so overwhelming that the range of feasible strategies does not encompass it. In this situation management is faced with the need to determine what risk management objectives can be achieved with the available information.

This chapter discusses the disagreement and confusion in the management of financial crises. The dispute centres on the role of the International Monetary Fund (IMF) in crisis management. While some argue that the IMF should provide more financial assistance and intervene regularly, others believe that it should do less. Given the lack of agreement on the basics, it is not surprising that very steps have been taken to improve crisis management. This chapter evaluates several proposals that may potentially improve the ability of the IMF in dealing with international financial crises.

Money or capital is important to an entrepreneur because he or she would need a lot of it to establish a business. Only a few, however, know how to properly approach various fund sources, when to approach these sources, and what each source considers when reviewing the credentials of the business. This chapter introduces three fundamental ways for achieving finance growth: self financing, which involves reinvesting earned profits; debt financing, which involves acquiring loans; and equity, which involves shares and partial ownership of the company. The chapter emphasizes that a company's failure cannot solely be attributed to insufficient capital as this may also be brought about by poor financial management.

This chapter discusses some successful initiatives for the prevention and management of international financial crises. On the prevention front, the focus on enhancing transparency, strengthening prudential supervision, and rationalizing exchange rate regimes has made a difference. This is highlighted in the Argentinean crises, which had a weaker spill over than in the Mexican Tequila of 1995, the Asian crisis of 1997, and the Russian default of 1998. On the management front, the successful initiatives include the augmentation of the resources of the International Monetary Fund, and the extension of Paris Club compatibility to Eurobond shareholders.

This chapter analyzes the importance of financial management, focusing on how female proprietors face the challenges of complex financial transactions on a daily basis. It argues that compared to men proprietors, women were especially poorly prepared as financial managers. The financial-management skills required in the operation of a business are best mastered through training and experience, and this is the sort of background that most female proprietors lacked.

This study examines the effects of a financial management training program for low-income audiences on financial knowledge and practices. Findings show that substantial pre-training knowledge deficiencies existed among immigrant participants on basic financial management issues. The program was effective in improving the financial knowledge and related financial behaviors of immigrant participants, and immigrants gained more in financial knowledge from the training than other participants. Implications are discussed for developing programs to improve the financial capacity of low-income immigrants.

The resource allocation and budgeting process is one of the most powerful stages of planning. Resource allocation refers to the distribution of resources, and in particular finance, from the centre to peripheral levels. Budgeting implies the more detailed determination of precisely how these funds are to be used. This chapter first outlines the major types of budget. It then looks at the main approaches to budgeting and resource allocation, and lastly discusses financial management issues relevant to the planner.

This chapter offers an analysis of a recent Economic and Social Research Council-funded project considering the difficulties associated with researching the complexities of the management of household money and budgeting within long-term heterosexual relationships. The study interviewed heterosexual couples living on means-tested benefits or tax credits and considered how they received, organised, and used such income, and how this affected gender relations and inequalities within the household. The chapter is organised as follows. The second section outlines existing typologies of household financial management and research on gendered patterns of money management. The third section presents the main findings on money management from the study in the light of the existing literature. The themes of this section include complexity, continuity in traditional gendered patterns of money management, and teasing out the relationship between managing money day to day and control over household finances; it looks at several potential indicators of financial control. The final section concludes by discussing some of the issues that emerged in a wider context.

In this chapter, I argue that financial risk poses unique challenges that justify a differential application of corporate law oversight standards. The steps in my argument are as follows. First, I show how modern firms with significant exposure to financial risk are different in fundamental ways that matter crucially to the application of oversight standards. Second, I argue that, notwithstanding these differences, the major Delaware oversight cases were correctly decided, though the result might have been the opposite if complaints had been framed differently, with relevant and important facts. Third, I argue that the federal case involving the JPMorgan “London Whale” episode was wrongly decided. I am not arguing for any change in the oversight standards themselves. Instead, my argument is that Delaware law already provides ample support and justification for holding directors to a higher standard with respect to the oversight of financial risk. The complexities of financial risk pose unique challenges that the Delaware courts should take into account when assessing director oversight failures. Such an approach would not subject directors to unwarranted exposure for oversight failures, or have negative implications for business, and it would not change Delaware’s approach to cases that do not involve financial risk.

This chapter discusses the reasons for studying and revisiting public finance. It explains that the reengineering of public finance in response to the rebalancing of markets and states has brought a host of changes to public financial management and has also led to the emergence of various issues affecting public finance including contracting out, private solutions to externalities and private financing of public sector projects. In addition, globalization has also led to greater scrutiny and more international debates concerning modes of public finance.