Етап ііі
Вправа 1
1. Б |
6. Г |
11. Б |
16. Б |
2. А |
7. А |
12. А |
17. Г |
3. А |
8. А |
13. В |
18. А |
4. Г |
9. Г |
14. Г |
19. A |
5. В |
10. Б |
15. В |
20. Б |
Вправа 2
1. А |
5. Е |
9. Н |
13. Д |
2. О |
6. М |
10. І |
14. И |
3. Л |
7. З |
11. В |
15. Б |
4. Г |
8. К |
12. Ж |
16. Є |
Вправа 5
1. Chinese people would find this very offensive (образливий). They consider Taiwan to be a part of China, not a separate country.
2. This would be the right thing to do. In most Muslim cultures (and the Malays are Muslims) you should not handle food with the left hand, as it is considered unclean.
3. A Japanese businessman who said this would actually mean ‘No, it is not possible’’, or ‘No, I don’t want to’. Sometimes this phrase is used because they consider it rude (грубий) to refuse a request directly.
4. This would be perfectly acceptable (прийнятний). At most informal social occasions, it is normal to arrive a little late (but not too late). It would be wrong to arrive too early.
5. Your Saudi hosts would appreciate an attempt at speaking Arabic, even if you could only speak a few words such as “Good morning’.
6. This would be the right thing to do. In many Arab countries, it would be considered rude to start talking about business immediately.
Вправа 6
1) 3
2) 1; 2; 3; 7; 9.
2.2. Методичні рекомендації до роботи над темами 10, 13
Мета роботи над темою 10: засвоїти лексичні одиниці, необхідні для розкриття сутності ведення бізнесу, фінансового менеджменту у бізнесі, бухгалтерського обліку у бізнесі.
Мета роботи над темою 13: оволодіти комунікативними компетенціями, які забезпечують адекватну мовленнєву поведінку в ситуаціях, пов’язаних з розумінням і наданням інформації відносно сутності ведення бізнесу, фінансового менеджменту та бухгалтерського обліку на підприємстві.
Роботу над темами 10 і 13 слід здійснювати паралельно, виконуючи всі завдання, надані в методичних рекомендаціях. Контрольні вправи необхідно виконувати в спеціальному зошиті. Загальна сума балів за контрольні вправи - 60.
План роботи над темами 10, 13
Започаткування і ведення бізнесу.
Фінансовий менеджмент.
Бухгалтерський облік.
Методичні рекомендації до роботи над темами 10, 13
Щоб оволодіти лексичними одиницями, необхідними для розриття причин започаткування бізнесу, виконайте вправи 1,2.
Exercise 1. Match up the following English words to their Ukrainian equivalents. Use your dictionary if necessary. (Оцінюється в 2 бали)
1. reason |
1. необхідна кількість |
2. to appreciate |
2. ефективність, продуктивність |
3. to make an attempt |
3. надихати, запалювати |
4. to exploit |
4. вести бізнес |
5. to adopt |
5. витрати |
6. employee |
6. причина |
7. to inspire |
7. дозволяти |
8. experience |
8. удаватися, досягати успіхів, мети |
9. redundancy |
9. намагатися, робити спробу |
10. to persuade |
10. переконувати |
11. to take on a risk |
11. використовувати |
12. to bring on a feeling of revulsion |
12. викликати відразу до чого-небудь |
13. determination |
13. відносити до |
14. conviction |
14. об’єднувати, з’єднувати |
15. entrepreneur |
15. постачати продукт |
16. to survive |
16. винагорода, компенсація |
17. to run a business |
17.оцінювати |
18. personnel |
18. приміщення |
19. failure |
19. прийняти, вибрати |
20. to succeed (in) |
20. скорочення штатів робітників або службовців |
21. to lack |
21. брати на себе ризик |
22. to provide a service |
22. підприємець |
23. to depend upon, on |
23. невдача, неуспіх; банкрутство |
24. to research the market |
24. рішучість |
25. to supply the product |
25. службовець, робітник |
26. required quantity |
26. досвід |
27. to relate to |
27. переконання |
28. to get smth. to |
28. досліджувати ринок |
29. premises |
29. надавати послугу |
30. to afford |
30. виживати |
31. to combine |
31. персонал |
32. reward |
32. бракувати |
33. input |
33. залежати від |
34. efficiency |
34. постачати |
Exercise 2. Complete the charts with the different parts of speech. Translate the obtained pairs of words into your mother tongue. (Оцінюється в 1 бал)
E.g. employ – employment
-
Verb
Noun
exploit
adoption
employ
employment
inspiration
experience
reduce
persuasion
determine
convict
survival
fail
success
provision
depend
relation
combine
reward
Постарайтесь дати відповіді на запитання, використовуючи фрази:
I suppose that… In my view… |
I am not sure… I have no idea… |
What are the reasons for starting a business?
Can you identify the major decisions to be made when starting a business?
Прочитайте швидко (за 3-4 хвилини) текст 1, намагаючись зрозуміти його якомога точніше й повніше.
TEXT 1
Why start a business?
Before starting and running your own business you should be able to identify the reasons for starting a business, major decisions to be made, to outline the major stages in the planning process, appreciate the importance of planning to the business enterprise and appreciate the main sources of business finance.
There are probably as many reasons and combinations of reasons for starting a business as there are people who make the attempt.
A person with an original idea for a service might decide to go into business to exploit the idea, rather than try to find somebody else prepared to adopt it.
Some people go into business because they hope for a higher standard of living as an owner of a business rather than as an employee.
The desire for independence can also inspire people who are already employed.
Redundancy and the fear of never finding another job may persuade someone to take on the risks of a business. The experience of redundancy can also bring on a feeling of revulsion against being dependent on the decisions of other people and a determination to have more control over life.
Whatever the reason for starting a business there are feelings of conviction, determination and optimism on the part of the entrepreneur. The entrepreneur must be careful to find the answers to the following questions if the business is to survive:
Have I the skills, experience and determination to run a business? The owner of a business is a resource of that business, and will be offering production and management skills to the small business. We can say that the answer to this question lies within the function of personnel. The success or failure of all the other functions will depend on the skills of the people engaged in them. Yet even the most skilful workforce cannot succeed if it lacks the support of finance, materials, market and organization.
What product will I make or what service will I provide? The answer to this question must go further than a list of the good or service. Amongst other things it must concern itself with design and quality. The decision will depend upon who will be likely to buy and the ability of the business to produce the good or service. This lies within both the marketing and production functions.
Will people buy my product? Who will buy it? Where will it be bought and at what price? Before an answer can be found to these questions the entrepreneur will have to research the market. This activity is part of the marketing function.
Can I supply the product at the right time, in the required quantities, at the desired quality and at the right price? These questions relate to the production activities of the firm.
Can I get the product to my customers at the right time, in the right quantities and at the right price? Marketing has the responsibility for answering this question too, together with the problem of informing and persuading people to buy.
Have I the money to buy the necessary premises, materials and machinery? Can 1 afford to employ labour? Which machines will give me the greatest profit? Which product will give me the greatest profit? The answers to these questions lie in the function of finance.
How am I to combine the different functions listed above so that they will work together and give the maximum reward for the minimum input? The term used to describe this concept is efficiency. The answers lie in the area of organization and control.
Прочитайте текст 1 ще раз, потім виконайте вправу 3.
Exercise 3. Are the following statements true or false? Correct the false ones. (Оцінюється в 3 бали)
Realization of an original idea, aspiration for a better standard of living, striving for independence, threat of dismissal from the staff are the reasons for starting a business.
Assuming risks of business can not prevent an entrepreneur from launching a business.
The survival of business involves proficient employees, the support of finance, materials, market and organization.
High quality goods and services, right price, market place, prompt delivery of product to customers are the essential conditions for the survival of a business.
Insufficient finance will give the maximum return for the minimum costs.
Постарайтесь дати відповіді на запитання.
Have you ever had to consider or draw up a business plan?
Why do you think an entrepreneur needs a business plan? Give specific reasons to support your answer.
What information do you think a business plan must represent?
Прочитайте швидко (за 3-4 хвилини) текст 2, намагаючись зрозуміти його якомога точніше й повніше. Придумайте доречний заголовок тексту.
TEXT 2
A business plan is a detailed written statement that describes the nature of the business, the target market, the advantage the business will have in relation to competition, and the resources and qualifications of the owner(s).
It may be months or even years between the birth of an idea and the starting of a business. During this time the would-be entrepreneur should be developing and refining the business plan. The business plan is likely to highlight problem areas in a proposed business. There are three reasons for this:
A thorough investigation into the costs, markets and available finance, clearly presented will identify the areas of weakness in the original idea and allow them to be eradicated before they cost money or lead to failure.
A good business plan will impress people like bank managers, both in its information and the business-like qualities of the person who has drawn it up.
The discipline of drawing up a business plan can draw attention to the areas in which the business lacks experience.
Contents of a business plan
Summary of the plan. A brief description of the business will include the goods it intends to offer to its customers, an indication of its market and its sources of supply. How brief this introduction is will depend upon the business. For a small, one person start-up business a hundred words might suffice. A more complex organisation will need a more detailed, and therefore a longer description. This part of the business plan is important if it is to be used to support a request for external investment. Many organisations offering capital to new businesses specialize in certain types of business activity. If they are going to reject a plan it is in the interests of the entrepreneur that they do so quickly. Then she/he can seek more sympathetic organisations without too great a loss of time.
Management. Information relating to the personal experience of the entrepreneur will indicate the chances of success to the bank manager or anyone being approached for capital. Banks and other lenders will need to understand the quality and experience of the management of the company. This section will contain details of the names, ages, experience, qualifications of the management, weaknesses and how to deal with them.
Personnel. Information relating to the rotation and personnel recruitment, i.e. employment of new managers, regional sales managers, sales people for the new regional structure. Arrangement and implementation of training for all staff concerned with the new production line etc.
Products and pricing. A detailed description of the product would include production costs and the proposed selling price. It should also try to isolate what sets this product apart from all similar products on the market. This will normally be very detailed, listing each product or service and saying why the company is producing or offering it, what market it is designed to reach and how successful it has been. It will also say how those products have been priced and how the company intends to increase or decrease the prices over the next few years.
Marketing. The business plan should also include a description of the market at which the product is directed. This will include the geographical area over which it is to be sold, the number of competitors and the special points which will set this business apart from its competitors. It should also indicate the potential for growth in the area.
Operational details. The location chosen for the business should be stated and explained. The explanation might include details of premises and the site chosen in terms of costs and in relation to the market, suppliers, manufacturing facilities and equipment needed.
Financial analysis. The business plan should also include the amount of funding that will be required. If the plan is intended to persuade people to invest in the business it should also state the return the investors can expect. For an existing business this statement should be accompanied by the financial statements of the business over several years. A new business might include projected financial statements of what is expected to happen.
Прочитайте текст 2 ще раз, потім виконайте вправу 4.
Exercise 4. Try to guess the words underlined from the context. Then use your dictionary to check the words.
Для перевірки правильності розуміння прочитаного тексту виконайте вправу 5.
Exercise 5. Answer the questions. (Оцінюється в 2 бали)
What are the reasons why a business plan is important to the success of an enterprise?
What are the major headings that should be included in a business plan?
Вивчіть правила складання бізнес-плану, користуючись у разі потреби словником.
What should be in the plan?
SUMMARY OF YOUR PLAN, highlighting the attraction of your business
what is the business?
what is the market?
potential for business
forecast profit figures
how much money is needed?
prospects for the investor/lender
THE PAST
when business started
brief summary of past performance (put accounts for last three years in an Appendix)
indication of how relevant or not past performance is to future progress
management (this is a crucial section)
your past employment and business record – identify achievements, not just a chronological statement
the record of other people working with you
if there are obvious weaknesses in your management, how you propose to deal with them
THE PRODUCT OR SERVICE
a simple description of what it does (avoid technical words). If essential, technical descriptions can go in an Appendix
why the product is unique or distinct
brief survey of competition
how the products will be developed, what new products are being considered, when replacement will be needed for existing product range, what competitive products may emerge
any patents applied for
MARKETING (also crucial)
The market:
its size, its past and future growth
analysis of market into sectors;
identification of sector your business is aimed at ikely customers: who they are, type (that is, industrial or consumer), size, how they buy your competitors: who are they, their size, their position in market, likely response to your challenge
Selling:
promotion, advertising (if any)
who will sell
some idea of your sales pitch (for example, the benefits) of your product
how you will price
OPERATIONAL DETAILS
a) where you will be based – location, premises
b) suppliers
c) manufacturing facilities
d) equipment needed
FINANCIAL ANALYSIS
summary of the forecasts
monthly profit and loss forecast for two years
profit forecast for further three years (optional)
monthly cash flow forecast for two years
cash flow forecast for further three years (optional)
forecast balance sheet for two years
audited accounts for last three years (if available)
the assumptions behind your forecasts
what are the principal risks which could affect figures?
THE PROSPECTS
your objectives – short-term, long-term
the finance needed and what it is needed for
shareholdings suggested (if appropriate)
prospects for the investor or lender (if appropriate, including possible value of business if floated on the stockmarket, so investors will be able to cash in their investment)
Прочитайте уривок з бізнес-плану, складеного починаючим підприємцем Hans Gast, потім розташуйте інформацію, що міститься в тексті, у відповідності до викладеної вище схеми бізнес-плану.
Hans Gast
BUSINESS PLAN
I wish to set up a refrigerated road transport business, with myself as a sole proprietor.
Initially, I shall have one truck with a load capacity of 1.5 tonnes. It will be fitted with a mobile phone. I shall undertake deliveries for chilled food distributors, offering them a service on which they know they can rely at short notice and in case of emergency. I have made preliminary enquiries with a number of firms, which I contacted while following a marketing course at Cardiff Polytechnic. Their response was very favourable.
I shall drive the truck myself and also employ part-time drivers. My fiancée will help me with administration, book-keeping and telephone enquiries. Her parents have offered us the use of a room in their house as an office, until we can find a small office to rent.
To finance this venture, I have £10,000 capital. My start-up costs will total £25,000. I am therefore seeking a bank loan of £15,000. I can offer the truck (estimated value £20,000) as security.
I have prepared a detailed cash-flow forecast for the first years of operation, and this shows that the break-even point (беззбитковість) is reached after twenty-two months. This assumes a bank loan of £15,000 over five years at an annual percentage rate of 18.5%, with interest-only repayments during the first six months.
Користуючись отриманою інформацією, складіть власний бізнес-план вашого (можливо, уявного) бізнесу.
Щоб оволодіти лексичними одиницями, необхідними для розкриття вимог щодо започаткування бізнесу, виконайте вправи 6, 7.
Exercise 6. Match the following Ukrainian words with their English equivalents. Use your dictionary if necessary. (Оцінюється в 2 бали)
-
а) існуючий
б) набувати, одержувати
в) позичати, брати на певний час
г) розмір, величина, об’єм
д) досягати
е) фінансувати
є) “впорскування” грошей
ж) використовувати перевагу
з) збереження
и) позика, кредит
і) розширювати, розвивати
ї) ділити, розподіляти, брати участь в
й) заощадження
к) власність, майно
л) витрачати гроші
м) втрата, збиток
н) забезпечення, запорука
о) повертати борг
п) позичати, давати в борг
р) вимагати
с) повертати собі, отримувати заново
т) застава
у) покупка у розстрочку
ф) початковий, первинний платіж
х) здавати або брати в найм, в оренду
ц) розумний, розсудливий
savings
security
mortgage
sensible
existing
size
to fund
to lease
to lend
initial payment
to acquire
hire purchase
to borrow from
to reach
loan
to share
injection of capital
to recover
to take advantage
to claim
maintenance
to spend money
to repay
to expand
possession
loss
Exercise 7. Which verbs in A can go with which nouns in B? Use your dictionary if necessary. (Оцінюється в 1 бал)
E.g. to start a business
A
acquire lend take receive borrow carry own reach make start recover fund buy expand hire share claim invest lease pay for spend repay bring in risk |
B
income money equipment business risk development good(s) capital profit loan payment refrigeration unit service(s) ownership decision investment possession(s) advantage(s) |
Постарайтесь дати відповіді на запитання, використовуючи фрази:
I would like to say… As far as I know… There is no doubt… |
I am afraid that… I can only say that… |
Have you got any idea where to get the money to start a new business?
Do you know what factors will affect the capital requirements of a business?
Прочитайте текст 3, намагаючись знайти в ньому підтвердження ваших припущень щодо одержання грошей для бізнесу та факторів, які впливають на вимоги щодо фінансування бізнесу.
TEXT 3
Starting a new business
Starting a new business carries with it the greatest degree of risk. It may be possible to begin on a very small scale without risking too much capital. You will also have greater freedom of action. You will not be limited by decisions other people have taken in the past if you buy an existing business. Starting a new business requires finance. There are just three ways in which a business acquires money:
from the money invested in the business by the owner or owners, including any profit which they decide to reinvest
by borrowing money from private individuals or from another organisation
by buying goods and services on credit, i.e. having the use of the goods and services before they are paid for
The basic principles of acquiring capital may be simple but the reality is far more complex. Each business will have its own particular requirements based upon such factors as:
the size of the business
the stage of development it has reached. For example, two businesses with a similar number of employees and making a similar profit may have totally different capital requirements. One business might be able to fund future investment from profits already made, but its future investment potential might be limited. The other business may need a large injection of capital if it is to take advantage of the market
maintenance of control; that will mean loans to expand the capital rather than sharing the ownership with other people
the organisations that make money available to businesses.
Let’s look at some basic definitions and the ways in which a very small business just starting up might find its capital in the first years of life.
The owner of the business invests money in it. This can come from savings or the sale of possessions. The important thing to remember is that it is the owner's money, to be spent as she/he wishes. If the money is lost, it is the owner's loss.
Money can be borrowed using possessions as a security. This statement means simply that if someone cannot repay the money then the person or organisation who lent that money can claim or sell that possession in order to recover the money they have lent. Mortgages are a specialised form of a loan on security. The security in this case is always property. All loans are usually made for a fixed period of time, for a fixed amount and at a fixed rate of interest.
Hire purchase and credit sales for equipment have a great deal in common. The difference lies in the ownership of the item. If a business buys a display refrigeration unit on hire purchase it does not own it until the last payment has been made. If it is a credit sale, it will own the refrigeration unit as soon as the initial payment has been made.
Trade credit is a system whereby a business receives the ownership of goods or services and does not have to pay for them immediately. The time involved can vary. In some businesses the goods or services bought in can be used and have brought in income before they have to be paid for.
Businesses can also lease equipment. If the equipment is needed for only a relatively short period of time then it is sensible to hire it. If the equipment is going to be used continuously then it is better to lease equipment.
Для перевірки правильності розуміння прочитаного тексту виконайте вправу 8.
Exercise 8. Are the following statements true or false? Correct the false ones. (Оцінюється в 3 бали)
If you decide to buy an existing business it is sensible to start on a large scale without risking too much money.
The finance invested in the business, borrowings from natural persons or from another organization, purchasing commodities or credit are the possible ways through which a recently set up business obtains money.
There are four basic factors determining particular requirements of each business.
Money invested in a small business just starting up can be obtained from savings or the sale of possessions.
If a person fails to pay back the money then the lender can divest that possession.
Hire buying and credit sales facilities have many discrepancies.
Trade credit requires paying promptly for the ownership of goods and services.
It is sensible to hire the equipment if it is going to be used continuously.
Подані нижче слова є ключовими у тексті 4. Про що цей текст?
ultimate secure to hinder labour force obsolete labour costs competitive |
implications costing production cost clerical price elasticity attitude pressure group |
to mount a campaign impact to reassess to modify circumstances to take into account |
Прочитайте уважно текст 4. Чи справдилися ваші прпущення щодо його змісту? Придумайте доречний заголовок тексту.
TEXT 4
A business, like the people who run it and the society in which it exists, is constantly changing. The way in which it develops and its ultimate success or failure depend upon:
People. The person who starts a business might be prepared to work long hours to make it a success. As it becomes more secure she/he might prefer more leisure time to increased profits. The way in which the business develops can be helped or hindered by the available skills in the labour force.
Technology. Changes in technology can make a product or a production method obsolete, that is old-fashioned or out of date. New products will have to be found, new machinery bought and the labour force retrained.
The economy. A high level of unemployment in an economy can mean a reduction in labour costs. It can also mean less demand for the product and a more competitive market. This will have implications for the costing, pricing and marketing of a product. It can also lead to changes in production methods and will certainly affect profitability.
The government. Governments make laws. A change in the laws governing health and safety in the workplace can lead to increased production costs. Other laws might increase the clerical work required of a business.
Other organizations. The attitudes and activities of trade unions, the activities of pressure groups can also affect the development of a business. A powerful and active trade union can influence working practices and raise the labour costs of a business. A political pressure group might mount a campaign to stop people buying certain types of goods.
The market. The markets in which a business operates will also affect its development.
The impact of these forces will vary from business to business and will depend, amongst other things, upon the size of the business, the quality of its management, the finance available to it and the way in which it has developed in the past. Whatever the effect on a business the business plan must be constantly reassessed and modified to take changing circumstances into account.
Прочитайте текст 4 ще раз, потім виконайте вправу 9.
Exercise 9. Here are some answers about factors affecting the development of a new business. Write the questions. (Оцінюється в 3 бали)
a) What ?
The way in which a new business moves forward or fails depends upon six factors.
b) Why ?
To make a new business a success.
c) In what case ?
The available skills in the labour force.
d) What ?
New product will have to be found, new machinery bought and the labour force retrained.
e) What ?
A high level of unemployment in the economy means a reduction in labour costs, less demand for the product and a more competitive market.
f) In which ways ?
By the ways in which the government raises money and spends it.
g) Who ?
A powerful and active trade unions.
h) Why ?
To take changing circumstances in which a business exists into account.
Розкажіть, що ви узнали про фактори, які впливають на розвиток бізнесу; представте власні думки щодо започаткування власного бізнесу.
Щоб оволодіти лексичними одиницями, необхідними для розкриття суності фінансового менеджменту, виконайте вправу 10.
Exercise 10. Match the following English words with their Ukrainian equivalents. Use your dictionary if necessary. (Оцінюється в 2 бали)
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Постарайтесь дати відповіді на запитання, використовуючи фрази:
As far as I remember … Unfortunately, I have no idea …
I would like to point out that … I am not absolutely certain, but I think …
What are the most important decisions a company has to make before starting or doing some business?
What is corporate finance?
What managers does the Vice-President for Finance supervise?
What is capital budgeting?
What is capital structure?
What is working capital?
Прочитайте уважно текст 5. Яка інформацію, що міститься в ньому, була вам вже відома?
TEXT 5
Financial management activities
Finance is the application of economic principles and concepts to business decision-making and problem solving. It is the function in a business responsible for acquiring funds for the firm, managing funds within the firm, and planning for the expenditure of funds on various assets.
Finances of a business enterprise need management. It is just the sphere of financial management. Financial management is the investment and financing decision making that goes on within all types of firms. The firm may be a business enterprise, such as manufacturing company, an accounting firm, an oil producer, a credit union, or a charitable organization. The small retail firm requires such decisions as where to get funds for its seasonal cash needs, selecting the appropriate level of inventory and cash on-hand, and deciding when best to expand. The large corporation needs to set its credit terms, decide where to get funds needed for expansion etc.
Any person or company starting or doing some business has three questions to answer, all connected to finance.
The first question is, “What long-term investments are necessary?” This means identifying the business to be done, and the buildings, machinery, and equipment needed to do it.
The second question is, “Where and how can the firm get long-term financing to pay for those investments?” Will the firm’s own money be sufficient? If not, will it try to interest others to invest in the business and share ownership, or will it borrow money?
The third question is, “How will the firm manage everyday financial activities?” These activities include collecting money from customer, paying suppliers, paying salaries and wages, administrative costs, etc.
The financial structure of a company is called corporate finance. The Financial Department in a company is responsible for its corporate finance.
It is known, that financial management is the responsibility of the Vice-President for Finance, who supervises the work of the Financial Department of a company.
High-level positions of a business that focus primarily on financial management typically include: Vice-President for Finance, Treasurer, Controller and Chief Financial officer. The Vice-President for Finance is charged with policy-making duties and acts as a liaison between financial manager and other management personnel. Often the Vice-President for Finance oversees the activities of the Controller and the Treasurer. The Treasurer is charged with obtaining capital for investments and investing cash in other assets of business. The Controller is charged with accounting and auditing functions and financial planning.
The Chief Financial officer is generally part of the top layer of management that reports to the Board of Directors.
All the financial activities are aimed at answering the three questions listed above. The answer to the first question is called capital budgeting. It is the process of planning and managing the firm’s long-term investments. To do that, the Financial Manager has to try to find opportunities for investments which are worth more to the firm than they cost to be acquired. That means that the amount of cash to be received as a result of an investment should be greater than its cost, i.e. greater than the amount of money spent to gain it.
The answer to the second question is found in capital structure. This structure is a mixture of long-term debt and the equity that a firm uses to finance its operations. Debt is a result of the firm borrowing money to finance its operations. Equity is the value of its property (also used as security for the financing) after deducting all the charges to which that property may be liable. The Financial Manager should decide on the suitable balance of debt and equity – what mixture of debt and equity is best for the firm. He or she should also find the least expensive sources of funding for the firm.
The working capital management is the answer to the third question. Working capital is the firm’s short-term assets - for instance, inventory. It also includes short-term liabilities, such as paying suppliers. Managing the working capital is necessary to ensure continuity of the firm’s operations without interruption. It requires a number of decisions, such as how much cash and inventory should be readily accessible at a moment’s notice, how to obtain short-term financing, etc.
Decisions made regarding any of these three basic questions of finance involve risks. That is why no firm can avoid some financial losses. But efficient financial management can bring those losses to a minimum, thus maximizing the profits.
Вивчіть уважно схему організації фінансової діяльності компанії, потім виконайте вправу 11.
Vice – President for Finance
Treasurer
Controller
Cash manager
Credit manager
Tax manager
Cost Accounting Manager
Capital Expenditures
Financial Planning
Financial Accounting Manager
Data Processing Manager
Exercise 11. Match managers ( under A) with definitions of their responsibilities (under B). (Оцінюється в 2 бали)
А В
a) treasurer |
1) regulates the flow of cash |
b) controller |
2) supervises the issues of tax payments |
c) cash manager d) cost accounting manager e) credit manager f) financial accounting manager g) data processing manager h) tax manager |
3) manages credit issues 4) is responsible for financial planning and planningexpenditure 5) processes all financial information concerning the firm 6) supervises cost accounting 7) supervises financial accounting 8) is in charge of controlling expenditure
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Користуючись словником, виконайте вправи 12, 13.
Exercise 12. Write the following words in the correct column. (Оцінюється в 1 бал)
financial task (2) include development application monitoring creating evaluating credit (2) investing excess cash (2) acquiring issuing additional spinning-off interpret report (2) improve data optimally effective finance (2) similarly need (2) understand like (3) remember critical expect survive essential (2) challenge (2) face (2) entire (2) function (2) greatly |
Nouns (23) |
Verbs (17) |
Adjectives (7) |
Adverbs (3) |
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financial |
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Exercise 13. Combine a word in A with a word in B to form a suitable noun phrase. (Оцінюється в 2 бали)
E.g. financial manager
A B
financial 1) cash
business 2) management
credit 3) accountant
excess 4) activity
cash 5) challenge
equity 6) business
top 7) manager
good 8) securities
small 9) statement
10) careful 10) life
11) essential 11) strength
12) entire 12) balance
13) accounting 13) policy
14) matters
Прочитайте швидко (за 2-3 хвилини) текст 6, потім придумайте і запишіть заголовок до нього.
TEXT 6
The financial manager’s task includes the development, application, and monitoring of policies and decisions regarding such business activities as:
Creating and evaluating credit policies for customers
Investing excess cash balances
Acquiring another company
Issuing additional equity securities
Spinning-off a subsidiary
A financial manager for a business is the doctor who interprets the report and makes recommendations to the patient regarding changes that would improve health. Financial managers use the data prepared by the accountants and make recommendations to top management regarding strategies for improving the financial strength of the firm.
A manager cannot be optimally effective at finance without understanding accounting. Similarly, a good accountant needs to understand finance. Accounting and finance, finance and accounting – the two go together like bread and butter.
As you may remember, financing a small business is a difficult but critical function if a firm expects to survive those important first five years. The simple reality is, the need for careful financial management is an essential ongoing challenge a business of any size must face throughout its entire life.
All financial managers functions depend greatly on the information provided by the accounting statements such as:
(funds management) |
(credit management)
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Для перевірки правильності розуміння прочитаного тексту виконайте вправу 14.
Exercise 14. Here are some answers about financial manager’s work. Write the questions. (Оцінюється в 3 бали)
What ___________________________________________________________?
The major task of financial manager is the development, application and monitoring of policies and decisions of a business.
Who ____________________________________________________________?
Accountants collect and choose data for financial managers.
Whom ___________________________________________________________?
Financial managers suggest the top management ways of improving the financial standing of the firm.
In what case ______________________________________________________?
Without understanding accounting a manager cannot be effective at finance.
What ____________________________________________________________?
Accounting statements.
Будьте готові до рольової гри на практичному занятті.
Role – play
Imagine that you are a human resource manager who selects employees to fill vacancies of:
a finance manager
a treasurer
a controller
Tell them about your company. Ask them about their education, business experience and professional qualification. Also have a talk with candidates about their official duties.
Ознайомтесь з інформацією щодо анотування тексту, книги, статті тощо.
Анотація – це коротке повідомлення, яке допомагає читачеві швидко визначити мету роботи, і тому надає тільки найважливішу інформацію, без деталей. Це може бути анотація книги, наукової статті, доповіді тощо.
Написання анотації вимагає знання її структури, а також уміння переробляти інформацію, використовуючи спеціальні мовні засоби.
Структура анотації:
вступ (тема, мета роботи, яка анотується);
основна частина (сутність роботи, що анотується);
заключна частина (авторський висновок; призначення роботи, що анотується).
Алгоритм складання анотації:
Прочитайте текст один раз для загального розуміння.
Прочитайте текст ще раз і виділіть в ньому основні моменти та важливі деталі.
Запишіть на основні моменти і важливі деталі на окремому аркуші паперу. Використовуйте тільки свої власні слова!
За допомогою нотатки, напишіть вступ до вашої анотації: вкажіть автора, назву роботи, джерело, а у випадку журнальної статті – дату публікації; потім сформулюйте тему і мету повідомлення.
Напишіть основну частину вашого резюме, використовуючи тільки свої власні слова; переконайтесь, що ви охопили всі ключові моменти і додали важливі деталі.
Напишіть заключну частину, в якій поясніть авторські висновки. Хоча анотація написано вами і вашими власними словами, вона не повинна містити ваших ідей.
Перечитайте і відредагуйте вашу анотацію. Виправте граматичні, орфографічні та пунктуаційні помилки.
Під час редагування анотації важливо звернути увагу на таке:
- наскільки чітко додержано структуру анотації;
- чи дає вступ уявлення про тему анотованого твору;
- наскільки точно визначено сутність анотованої роботи;
- чи не використана зайва інформація;
- чи правильно побудовані речення;
- наскільки дотримані норми правопису.
Доцільно здійснювати редагування анотації на комп’ютері. Це дозволить вам заощадити час і сприятиме розширенню вашого словарного запасу завдяки можливості комп’ютера надавати синоніми (команда “Тезаурус”).
Напишіть чистий варіант та впевніться, що в ньому немає помилок.
Корисні вирази, які можна використати під час написання анотації
У вступі
Storey J (1989) Human resource management in the public sector. Public Money and Management, 9(3):19-24. |
Сторей Дж. Управління людськими ресурсами в громадському секторі // Громадські гроші та менеджмент. - 1989. - № 9(3). - С. 19-24. |
The article is devoted to … The article deals with … The text presents… - the analysis of …
of) …
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Статтю присвячено … У статті розглядається … У тексті представлено … - аналіз … - порівняння … - опис … - обговорення … - результати дослідження з …
- огляд літератури з… |
The author - analyses … - compares … - describes - discloses (reveals)… - reviews … - shows (demonstrates)… - provides the reader with ...
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Автор - аналізує … - порівнює … - описує … - розкриває … - робить огляд … - показує … - надає читачеві … |
In the book ‘Motivation and Personality’ A. Maslow discusses ….
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У книзі «Мотиваціия і особистість» А.Маслоу обговорює … |
Text ‘Groups and Teams in the organization’
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Текст «Групи і команди в організації»
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In the article on Orientation and Training of Employees (Ohio State University Fact Sheet), Mark Mechling explains ….
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У статті «Орієнтація та навчання працівників» (Ohio State University Fact Sheet) Марк Меклинг пояснює … |
The purpose of the article (text / chapter, etc) is … - to inform … - to clarify …
- to determine (ascertain, establish) … - to elucidate … - to explain … - to prove (validate) … - to substantiate … - to compare … - to persuade …
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Мета статті (тексту / розділу тощо) полягає в тому, щоб ... - поінформувати …. - з’ясувати (внести ясність у) … - визначити (встановити) … - висвітлити (роз’яснити) … - пояснити … - довести … - обґрунтувати … - порівняти ... - переконати … |
В основній частині
The author begins by explaining ...
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Автор починає з пояснення… |
The author emphasizes (stresses) the importance of … |
Автор підкреслює важливість … |
The author focuses on …
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Автор зосереджується на … |
Special emphasis (stress) is laid (placed, put) on …
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Особливий наголос ставиться на … |
Particular importance (significance, value, weight) is attached to …
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Особливе значення надається … |
Readers’ attention is called (attracted, drawn) to …
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Увага читачів привертається до … |
The author uses examples to confirm / prove that…
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Автор використовує приклади, щоб підтвердити / довести … |
The obtained data are exemplified with … |
Прикладом отриманих даних служить ...
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В заключній частині
The author makes two important implications (inferences, conclusions). |
Автор робить два важливі припущення (висновки).
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Hence (therefore, thus) it is concluded that … |
Отже (таким чином), робиться висновок, що …
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It follows from these findings that … |
Із цих результатів випливає, що … |
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The article (text / section, etc.) is intended for …
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Стаття (текст / розділ тощо) призначена для ... |
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The article (text / chapter, etc) will be useful (helpful, valuable) for ...
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Стаття (текст / розділ тощо) буде корисною для ...
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The book is intended for a wide audience, including ...
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Книга призначена широкій аудиторії, включаючи … |
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Вивчіть уважно приклад анотації на матеріалі тексту 5.
The text is devoted to financial activities and financial management of a business. The purpose of the text is to elucidate the essence of financial management and to show its significance for all types of business. The author focuses on the three main questions connected to finance, which arise while starting or running business, and describes activities aimed at answering these questions: capital budgeting, capital structure and working capital management. Particular importance is attached to the responsibilities of management positions within a company. The text is useful for financial managers and students majoring in Finance.
Користуючись рекомендаціями до написання анотації та прикладом анотації тексту 5, напишіть анотацію тексту 6.
Щоб оволодіти лексичними одиницями, необхідними для розкриття сутності бухгалтерського обліку, виконайте вправу 15.
Exercise 15. Match the following English words with their Ukrainian equivalents. Use your dictionary if necessary. (Оцінюється в 1 бал)
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Постарайтесь дати відповіді на запитання, використовуючи фрази:
I believe it is rather an interesting problem… Unfortunately, I have no idea … |
It depends, I think, on… I’m not absolutely certain, but I think… |
Why is it necessary for any company to keep a record of what they possess?
The accounting profession has some advantages and disadvantages. Do you have any idea what they are?
Прочитайте уважно текст 7. Яка інформація, що міститься в ньому, була вам уже відома?
Text 7
Introduction to accounting
Since people have owned properly they have devised methods of keeping a record of what they possessed and its value. They wished to keep an account of what they had and, when responsible for other people’s property, they needed to render an account of how they had used it. Traditionally the accounting profession has been divided into financial accountants, whose professional association is the Institute of Chartered Accountants, and management accountants, who are members of the Institute of Cost and Management Accountants.
Financial accountants are primarily concerned with making sure that the accounts of a business are a true and fair record of the financial transactions of the business. They may do this by drawing up the accounts of a business from the records kept by the various departments or, acting on behalf of another business, they may examine existing accounts and declare them to be a true and fair record. This process is known as auditing.
Management accountants are more interested in the information they can derive from financial accounts.
Для перевірки правильності розуміння прочитаного тексту виконайте вправу 16.
Exercise 16. Answer the questions. (Оцінюється в 3 бали)
What is of vital importance for people if they own property and run a business?
What is a traditional division in the accounting profession?
Which of two professional associations mentioned in the text relates to financial accountants and which to management accountants?
In what way do the responsibilities of a financial accountant differ from a management accountant?
Будьте готові до рольової гри на практичному занятті.
Role – play
Student A. You are a personnel manager in a food processing company. You have to select the best candidate for the position of financial accountant. You are expected to interview an applicant and explain the financial accountant’s duties and responsibilities.
Student B. You are an applicant for the post of a financial accountant.
You have just graduated from the University and are eager to get a well-paid job. Persuade the staff manager that you are the best applicant for this post.
Щоб оволодіти лексичними одиницями, необхідними для розкриття сутності активів і пасивів бізнесу, виконайте вправу 17.
Exercise 17. Match the following English words with their Ukrainian equivalents. Use your dictionary if necessary. (Оцінюється в 2 бали)
a) fixed assets b) current assets c) to intend d) to turn into cash e) loss of value f) liquid assets g) to reflect h) leasehold land i) lessor j) lessee k) freehold property e) marginally m) vehicles n) to rank o) goodwill p) trademark q) to enjoy r) to deny s) to secure t) letters patent u) to invent v) to license w) copyright x) originator y) prepayment z) to grant a credit
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а) передплата б) той, хто дає щось в оренду в) надавати кредит г) надавати ліцензію д) користування землею на правах оренди е) автотранспортні засоби є) авторське право ж) перевести, перетворити у готівку з) поточні активи, оборотні засоби и) мати намір, призначати і) гарантувати, забезпечити ї) користуватися правами й) відображати к) гранично л) основний капітал, основні засоби м) патентна грамота н) орендар о) повна земельна власність п) втрата вартості to secure t) letters patent u) to invent v) to license w) copyright x) originator y) prepayment z) to grant a credit товарний знак с) винаходити т) ліквідні активи, оборотний капітал у) класифікувати, розподіляти ф) умовна вартість репутації і ділових зв’язків х) автор , творець ц) заперечувати, відмовлятися
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Постарайтесь дати відповіді на запитання, використовуючи фрази:
I think I know… I am sure that… |
I am not quite sure that … I don’t know whether… |
Do you know the meaning of the word “liquid”? Why is cash considered to be the most liquid of assets?
What is the distinction between current and fixed assets?
What are liabilities?
Прочитайте уважно текст 8. Яка інформація, що міститься в ньому, була вам уже відома?
TEXT 8
Assets and liabilities
Assets can be defined as the properties, machinery, investments and cash owned by a business and which are used to achieve objectives. Thus, assets are the resources owned by a business. They are classified as fixed assets and current assets. Fixed assets are normally those which the business intends to hold for more than one year and which are not intended for resale. They are the resources the business needs to function, but they may also include investments in other firms. The conventional order for listing fixed assets begins with the most illiquid, that is the asset which is most difficult to turn into cash without loss of value and ends with the most liquid asset, i.e. the one most easily turned into cash without loss of value. This order also tends to reflect the life of an asset within a business. In normal circumstances land and buildings would be the last assets to be sold if the business went bankrupt or into liquidation. It is therefore classified as the most fixed, i.e the least liquid, asset. Cash is changing all the time, and is therefore the least fixed, i.e the most liquid, asset. An outline listing of fixed assets can be given as:
1. Freehold land and buildings. The word “freehold” means that the owner has absolute rights over the land and does not have to pay rent for it.
2. Leasehold land and buildings. A lease is a legal agreement between the owner of a property, the lessor, and another person, the lessee, that the lessee shall have the use of that property for a specified period of time. The time clause means that leasehold is both less fixed in terms of ownership than freehold property and also more difficult to sell without loss of value.
3. Plant, machinery and equipment. After buildings a business needs the physical equipment to produce the good or service. Without them the business could not function, so they are only marginally less fixed than the buildings.
4. Vehicles. A van or car is both more flexible in use and has a shorter working life than a piece of machinery or a factory. It therefore ranks as less fixed than both.
5. Goodwill, patents and trademarks. These are easy to define but more difficult to value.
Goodwill is the favour and prestige a business enjoys which adds value to it beyond the value of its physical assets. Unfortunately there is no way of knowing the value of goodwill until the business is sold. To ignore it totally would be to deny an asset of the business. Estimates of goodwill should be conservative.
Patents are legal documents securing to an inventor the exclusive right to make or sell an invention. Once an inventor has secured the letters patent to an invention they may license other people to use the invention. This is a legal agreement and the inventor will receive royalties in payment for the licence. Patents usually refer to the invention of machinery. In the media - books, films, records, videos - and the world of computer software the equivalent protection is copyright. Both patents and copyright attempt to protect the originators of an idea from exploitation by other people
Trademarks identify a product and help build up consumer loyalty. If you bought a factory manufacturing the well-known Megamints you would want to be able to continue using that name. A successful trademark is the end result of good marketing and quality control. It ensures continuing sales.
6. Investments. These are not expected to be held beyond the present accounting period. An accounting period usually lasts for one year.
Current assets
Current assets are those which are 'used up' in the day-to-day operations of a business and which can be converted into cash faster and without potential loss of value. Their listing follows the same convention as fixed assets: the most permanent and illiquid are placed first, whilst cash is last. Current assets include stock, debtors and prepayments, cash at bank and cash in hand. Debtors are those businesses which have taken delivery of goods but which have not yet paid for them, in other words, firms to whom the business has granted trade credit.
Liabilities
Strictly speaking a liability is a contribution of resources to a business for which a business has to render an account of its use. The formation of a company gives the business a separate legal identity and the people who run the business must, by law, account for the way in which they have used the money entrusted to them. This will include money lent to the business and also money invested in the business by the owners that is shareholder’s funds. Sole traders and partnerships are not subject to the same legal constraints as companies, in that their accounts do not have to be made public, but the accounts of these businesses are treated as if the business is a separate identity from the owner. This has the practical advantage of allowing the owners of the business to keep a clear record of how much money they have invested and therefore of being able to judge the profit/loss position of the business more accurately. In the case of the sole trader the owner's capital would be presented as proprietor's funds. The usual practice is to start with owner's funds, follow this with loans which will not have to be repaid in the current accounting year, then current liabilities.
Current liabilities
Payments which will have to be made in the current financial year include provision for repayments of debts expected to mature and other expenses such as tax, bank overdrafts and creditors. There is no conventional order for the presentation of current liabilities.
Для перевірки правильності розуміння прочитаного тексту виконайте вправи 18, 19.
Exercise 18. Use the chart and without looking into the text:
a) define the words:
current assets
liquid assets
illiquid assets
b) distinguish between current and fixed assets.
Assets
Current
Fixed
cash in hand
or in the bank
accounts
receivable (amounts due from customers)
Land
Buildings
Equipment, plant, machinery
prepaid expenses (advance payments of insurance, rent, etc.)
inventories(materials, supplies or goods on hand)
Vehicles
readily marketable securities (expected to be sold within one year)
Goodwill, patents, trademark, copyrights
Investments
Exercise 19. Here are some answers about the assets of a company. Write the questions. (Оцінюється в 3 бали)
a) What ______________?
Assets are the resources owned by a business
b) How_______________?
Liquid asset is the asset which is easily turned into cash without loss of value whilst illiquid asset is the one which is difficult to turn into cash without loss of value.
c) Why_______________?
Fixed assets are normally those which the business intends to hold for more than one year and which are not intended for resale.
d) What___________________?
Both patents and copyright attempt to protect the originators of an idea from exploitation by other people.
e) In what way______________?
Current assets are those which are used up in the day- to- day operations of a business and which can be converted into cash faster and without potential loss of value.
f) What____________________?
Current assets include stock, debtors and prepayments, cash at bank and cash in hand.
g) Which___________________?
Money lent to the business and also money invested in the business by the owners.
h) When____________________?
Current liabilities payments are to be made in the current financial year.
В усній формі дайте визначення патенту і розкажіть, чому патенти, гудвіл та торгові марки вважають активами компанії.
Прочитайте текст 9, намагаючись зрозуміти його якомога точніше і повніше.
TEXT 9
Balance sheet
A balance sheet is the financial statement that reports the financial condition of a firm at a specific time as recorded by an accountant. It is composed of assets and liabilities.
A balance sheet provides a summary of the way in which a business has used the resources available to it over a period of time. In Table 1 you can see the balance sheet of the Baines Nursery at the start of trading.
Table 1. Balance sheet, Baines Nursery at start of trading
Balance sheet: Baines Nursery as at 30 September 2004
Freehold land/buildings £ 30000 Proprietor's capital £35000
Cash at bank £ 5000
Between 1 October and 14 November the Baines employ a builder to undertake the necessary alterations. For the purposes of this case study we will assume that the cost of the alterations was exactly the same as his estimate, £10 000. He funded the alterations by borrowing £10 000 from the bank. This gives the following action:
Assets (freehold property)+£10 000
combined with a reaction:
Assets (bank loan)-£10 000
Table 2. Balance sheet, Baines Nursery, after alterations to premises
Balance sheet: Baines Nursery as at 30 November 2004
Freehold land/buildings £ 40000 Proprietor's capital £35000 Cash at bank £ 5000 Bank loan £10000 |
The Baines buy fixtures and fittings together with equipment to the value of £5000. Again this is an assets +/ assets- transaction.
Table 3. Balance sheet, Baines Nursery, after purchase of fixtures, fittings and equipment and grant of bank loan
Balance sheet: Baines Nursery as at 31 December 2004
Freehold land/buildings £ 40000 Proprietor's capital £35000
Fixtures & fittings £ 5000 Bank loan £10000
Cash at bank £ —
The Baines are now short of money. They negotiate an overdraft for £1000. This increases both their liabilities and their assets.
Table 4. Balance sheet, Baines Nursery, after negotiation of overdraft
Balance sheet: Baines Nursery as at 31 January 2005
Freehold land/buildings £ 40000 Proprietor's capital £35000 Fixtures & fittings £ 5000 Bank loan £10000 Cash at bank £ 1000 Overdraft £ 1000
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Table 5. Balance sheet, Baines Nursery, after first six months' profit
Balance sheet: Baines Nursery as at 31 July 2005
Freehold land/buildings £ 40000 Proprietor's capital £35500 Fixtures & fittings £ 5000 Bank loan £10000 Cash at bank £ 500 |
After six months in operation the Baines have accumulated enough cash to pay off their overdraft with £500 to spare. Their cash figure will fall (assets-) but so will the overdraft disappear (liabilities-) and the proprietors' capital will be increased by the amount of their own money now in the bank. This is, of course, a very simple form of balance sheet but it does illustrate the principles contained in all balance sheets. On the right are the liabilities or the sources of funds used by a business. On the left the listed assets show how these funds have been used.
Table 6. Columnar form of a balance sheet
Balance sheet as at.................
£000 £000 £000
ASSETS EMPLOYED
FIXED ASSETS Cost Deprec. Net
Freehold premises 4000 1000 3000
Leasehold premises 1000 370 630
Plant and machinery 5000 2355 2645
M otor vehicles 970 200 770
Investments 10970 3925 7045
CURRENT ASSETS
Stock (inventories) 5500
Debtors and prepayments 1500
Marketable (liquid) securities 500
Bank balance and cash 100
7600
Deduct
CURRENT LIABILITIES
Creditors 1754
Tax and prepayments in coming year 500
Bank overdraft 451
P roposed dividends 335
NET CURRENT ASSETS 3040
NET ASSETS EMPLOYED 4560
12400
FINANCED BY:
SHARE CAPITAL
Ordinary shares 5300
Preference shares 2100
7400
RESERVES 2500
9900
LOAN CAPITAL 2500
Debentures 12400
The way in which the balance sheet in Table 5 is presented is called the T form. It is still in use but most large businesses now use the columnar form, as shown in Table 6. This has the major advantage of distinguishing clearly between the sources and use of funds and it is generally accepted as an easier form to interpret.
The balance sheet shows the position of a business at a given moment but it does not tell us how the business reached that position, the level of its sales and how the profit made had been divided between the various parties with a claim to it. For this information we need two other financial statements: the profit and loss account and the funds flow statement.
Для перевірки правильності розуміння прочитаного тексту виконайте вправи 20, 21, 22.
Exercise 20. Answer the questions. (Оцінюється в 3 бали)
What is a balance sheet?
Why is it necessary for a business to provide a balance sheet?
What is the difference between the columnar form and the T form?
What are two other financial statements?
Exercise 21. Find in the text and write down words that mean the same as the following definitions. They are in the same order as they appear in the text. (Оцінюється в 3 бали)
a. a written statement showing the value of a company at a particular time |
b. something such as money, workers, or equipment that can be used to help a business |
c. an arrangement in which someone completely owns a building or a piece of land |
d. money in the form of notes and coins |
e. to agree to be responsible for a job or project and do it |
f. a change in the form of something |
g. the amount of money that is needed in order to buy, pay for, or do something |
h. a statement telling a customer how much money you will charge if they employ you to do a particular piece of work |
i. to provide the money for something that costs a lot |
j. to receive and use money that belongs to someone else and promise to give it back to them later |
k. money provided by a bank to a customer, for an agreed purpose and period of time |
l. the buildings that a business or organization uses |
m. a piece of furniture or equipment that is fixed in its place and is considered part of the building |
n. a piece of something that you connect to something |
o. the action or process of buying or selling or doing something related to business |
p. to buy something |
q. to be pressed for money |
r. an agreement with your bank that allows you to spend money when you have no money left in your account |
s. a person, place or thing that provides something you need or want |
t. assets which are expected to stay in the business for longer than the given accounting period. The business will need them to continue operations in future |
u. assets which are “used up” in the day - to – day operations of a business and which can be converted into cash faster and without potential loss of value |
v. property or goods that you agree to give to someone who has lent you money if you cannot pay the money back |
w. to take an amount or number from a total |
x. regular costs and money owed
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y. an official arrangement with a company in which the company promises to pay a fixed rate of interest on money you have invested in it |
z. an official document that lists the amounts of money that have been put in or taken out of a bank account |
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Exercise 22. Compare the net profit of Baines’ Nursery after tax with the amount of money they invested in the business. Assuming banks are paying 10 per cent interest on deposit accounts should the Baines be pleased with the results of their first year’s trading? Explain your answer.
Вивчіть зразок балансового звіту, потім виконайте вправу 23.
BOGUS INDUSTRIES plc
Balance sheet as at 31 December 2004
ASSETS $000
Fixed assets
(1) Property 420
Buildings 180
(2) Equipment and machinery 100
Total fixed assets 700
Current assets
Raw materials } (3) goods
Work-in-progress } held in 200
Finished goods } storage
Debtors 90
Cash in bank 60
Total current assets 350
Current liabilities
(4) People owed money 80
(5) Money owed to the bank 50
(6) Money owed to the government 35
Total current liabilities 165
(7) Net current assets 185
Net assets 885
CAPITAL
(8) Money invested in the company and represented by shares
(9) Shares paying a variable dividend to shareholders 500
(10) Shares paying a fixed dividend to shareholders 300
(11) Shares held in a special fund used to pay off
creditors if the company goes into liquidation 85
Total 885
Exercise 23. Replace the underlined words or phrases with words or phrases from the box, which have a similar meaning. (Оцінюється в 2 бали)
bank overdraft land preference shares tax
capital reserves ordinary shares share capital working capital creditors plant stock
Прочитайте уважно текст 10, намагаючись зрозуміти його якомога точніше і повніше.
TEXT 10
Financial statements
The profit and loss account
The profit and loss account is a statement of the amount of profit or loss a business has made in a period of time. For convenience and ease of interpretation the information is contained in three sections.
1. The trading account. This includes the revenue from sales and the costs associated with producing those sales.
Revenue - Cost of sales = Gross profit
The profit and loss account. Payments such as interest and directors' fees are deducted from the gross profit to give net profit before tax. Tax is then deducted to give net profit after tax.
Table 7 A profit and loss account
Profit and loss account for year ending 30 June 2005
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£000 £000 £000 |
SALES 0795 |
Cost of sales 8650 |
GROSS PROFIT 2145 |
Less OVERHEADS Administration Wages and salaries 235 Stationery 95 Heat and light 50 Rates, rent, insurance 75 Depreciation 10 375
Finance: Interest 100 Bad debts 95 195
Selling: Salaries 100 Distribution 50 Advertising 150 300 870
Net profit 1275
Corporation tax 383 Net profit after tax 892
Ordinary share dividend 400
Reserves 492 |
3. The appropriation account. To appropriate means to set aside for a purpose or to make something the private property of an individual or an organization. The appropriation account tells interested parties how the business has used the net profit after tax. A company's appropriation account would include the amount distributed to shareholders, the amount transferred to general reserve and the retained profit. The presentation of a profit and loss account is shown in Table 7.
Funds flow statement
A funds flow statement shows the sources and uses of funds employed by a business over a period of time.
If you look at the information given in a funds flow statement and compare it with the information given in the balance sheet you will see many apparent similarities in the information. The difference lies in the period of time summarized by each statement. The balance sheet gives the sources and use of funds from the beginning of the life of a business. The funds flow statement usually relates to a shorter period of time.
Funds flows are useful to analyze the effects of changes in working capital. Transactions that result in an increase in working capital are sources of funds. Those which lead to a decrease in working capital are funds flowing out of the firm, that is the use of funds. The funds flow analysis shows changes in working capital for a given period.
Value added statement
The value added statement indicates the difference between the cost of bought in goods and services and the sales revenue of the business. It is the value added to these things by the effort of the business.
Для перевірки правильності розуміння прочитаного тексту виконайте вправи 24, 25.
Exercise 24. Answer the questions. (Оцінюється в 3 бали)
What is the profit and loss account?
What is the difference between the balance sheet and the profit and loss account?
What does a funds flow statement present?
What is the main difference between the balance sheet and the funds flow statement?
Exercise 25. Find words in the text that mean the same as the following. (Оцінюється в 2 бали)
a. revenue b. damage c. bill d. included e. selling f. expenses, charges g. per cent h. bonus i. levy |
j. price k. supplementary costs l. cover m. wear n. publicity campaign o. to allocate p. dispensed q. stockholders r. remitted |
s. retention t. movement u. utilized v. resemblances w. to concern x. current assets y. alterations z. attempt |
Щоб оволодіти лексичними одиницями, необхідними для розкриття сутності оцінки активів бізнесу, виконайте вправу 26.
Exercise 26. Match the following English words with their Ukrainian equivalents. Use your dictionary if necessary. (Оцінюється в 2 бали)
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Перед читанням тексту 11 постарайтесь дати відповіді на запитання, використовуючи фрази:
-
I consider that…
As far as I know…
I am not completely certain that…
If I'm not mistaken…
In what way does the valuation of fixed assets relate to depreciation?
Прочитайте уважно текст 11. Яка інформація, що міститься в ньому, була вам уже відома?
TEXT 11
Valuation of assets
The only sure way of knowing what an asset is worth to a business is by offering it for sale. Fixed assets such as machinery and vehicles have a limited life span, although at times it can run into decades. So far we have referred to the “life” of a machine as if this was a fixed period of time. The life span of a machine can vary according to the situation in which the business finds itself. Museums contain many examples of working machines that are obviously still in existence but whose usefulness is over. Throughout its life an asset's value is falling. If this change in value is ignored the profit declared by a business can appear low compared with the amount of capital employed. It is usual, therefore, to write off some of the value of the machine each year. This appears as a charge on the profit and loss account before tax is paid. This charge is called depreciation.
By depreciating its fixed assets a business saves on tax and increases profit. However, depreciation itself is not a method of saving up for replacement machinery. That is a decision taken separately by the business when deciding how to use its profit. Depreciation reduces the book value of an asset, i.e. its value after depreciation has been charged. The book value does not reflect the market value of the asset and in itself depends on the method of depreciation used.
The two most common methods of depreciation are straight line depreciation and declining balance depreciation.
1. The straight line method of depreciating assets reduces the book value of the asset by the same amount for each year of its life. An asset which cost £12 000 with an expected life of ten years and a residual value (that is the amount the business expects to sell the machine for at the end of its working life) of £2000 would be depreciated by £1000 per year:
(Cost of asset - Residual value)/ Life of asset
Figure 1. Straight line depreciation Figure 2. Declining balance depreciation
Book value Book value
1
2
12
10 10
8 8
6 6
4 4
2
2
1 Residual value 1 Residual value
0
1 2 3 4 5 6 7 8 9 10
0 1 2 3 4 5 6 7 8 9 10
Time (years) Time (years)
Straight line depreciation is a simple and straightforward calculation. It gives a higher level of profit to the business in the first years of the life of the machine and is particularly useful when the business is expecting constant returns over the life of the asset. This is shown in Figure l.
2. The declining balance method of depreciation reduces the book value of the asset by a fixed percentage calculated to apportion the value of the machine after residual value has been subtracted from initial cost over the expected life of the machine. This means that depreciation is highest in the early years of the life of the machine. The use of the declining balance method takes into account that as the machine grows older its running and maintenance costs are likely to increase and its earning power will decrease. As a machine gets older it is more susceptible to obsolescence and may be more difficult to sell. Figure 2 shows declining balance depreciation using the data from Figure 1.
Для перевірки правильності розуміння прочитаного тексту виконайте вправи 27, 28, 29.
Exercise 27. Choose the correct answer from a, b, c. (Оцінюється в 3 бали)
1. To become aware of an assets value means:
b) to see it
c) to buy it
d) to change it
2. Fixed assets are:
a) petrol and oil
b) machinery and vehicles
c) stock and debtors
3. During a life span an asset’s value:
a) does not change
b) decreases
c) increases
4. Some of value of fixed assets is necessary:
a) to charge each year
b) to write off in a year
c) to write off each year
5. Writing off some of value is:
a) a charge on the profit and loss account after tax is paid
b) a charge on the profit and loss account before tax is paid
c) a charge on the profit and loss account
6. Deprecation of fixed assets means:
a) to economize on tax and increase profit
b) to economize on tax and decrease profit
c) to understate taxes and increase profit
7. To depreciate the book value of an asset is:
a) to reduce the book value of an asset
b) to increase the book value of an asset
c) to control the book value of an asset
8. The book value does not reflect:
a) historical value of an asset
b) cost value of an asset
c) market value of an asset
9. How many methods of depreciation exist?
a) one
b) four
c) two
10. What method of depreciation does not exist?
a) the straight line method
b) the declining balance depreciation
c) the progressive balance depreciation
11. The straight line method of depreciating assets:
a) reduces the book value by the fixed amount for each year of its life
b) reduces the book value by the same amount for each year of its life
c) reduces the book value by the amount increasing each year
12. The declining balance method indicates that:
a) deprecation is lowest in the early years of the life of an asset
b) deprecation is highest in the early years of the life of an asset
c) deprecation is the same each year of the life of an asset
13. The use of the declining balance method takes into account that as an asset grows older:
a) its running and maintenance costs increase
b) its production and distribution costs increase
c) its running and maintenance costs increase
Exercise 28. Find words in the text that mean the opposite of the following. (Оцінюється в 3 бали)
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Exercise 29. Напишіть переклад тексту 11. (Оцінюється в 3 бали)