Пойгина Л.Б., Туринова Л.А. - English for Masters. Management Part 2 (Пойгина Л.Б., Туринова Л.А. - English for Masters. Management Part 2.pdf), страница 3

Discussing exercise.a) => Define financial statement analysis and explain how financial statement analysis helps structurethe commercial lending decision.b) => Prepare a list of factors that contribute to the stability of an organization seeking a loan. Forexample, a company with little debt can better withstand a recession because it has less interestand loan principal payments than a company with significant debt.c) => Consider how the concept on uncertainty affects a loan officer's assessment of risk.

For example,can the economy, weather, or election results be accurately predicted? What aspects of society canbe forecasted? In your opinion, what trends can be studied to narrow the uncertainty gap?5. Summarizing exercised)e)Sum up the main points presented in Text 1. Write the plan of the text in the form ofstatements.Develop your plan into the summary.6. Translation exerciseTranslate into English. Divide the text into logical parts. Suggest a plan of the text in the form ofstatements in English.

Use the following word-combinations:The Great Depression; capital funds on the equity markets; short-term lending from commercial banks;unregulated stock market; cyclical swings; the lack of diligent analysis; market value of collateral; the stateof the economy; severe financial distress; reliable financial information; a drop in confidence by investors;collapse of the stock market; to seek additional capital to expand; a chain reaction; short-term credit againstplanned stock issues; to face with undercapitalized borrowers; defaulting loans; to call in loan portfolios; tocool the booming economy; to cause large capital losses; the Securities and Exchange Commission;8generally accepted accounting principles (GAAP): the American Accounting Association; the AmericanInstitute of Certified Public Accounts; the Financial Accounting Standards (FASB); the engage in financialstatement analysis; lo eliminate the personal interaction; bank and borrower relationship; to preparestatements in accordance with GAAP.Рождение Современного Анализа Финансовой ОтчетностиДо Большой Депрессии предпринимателям выдавалось меньшее количество кредитов, чем этоимеет место сегодня.

В то время большинство деловых фирм рассчитывало на рынки акционерногокапитала или на краткосрочные кредиты от коммерческих банков. Значительная роль, которуюиграет нерегулируемый рынок акций, его циклические колебания, и недостаток прилежного анализакредиторами, выдавшими кредит исключительно на основе рыночной ценности имущественногоЙпога или состояния экономики, периодически создавала серьезные финансовые бедствия.Последовательная и надежная финансовая информация была доступна в ограниченных количествах,поэтому снижение акции в 1929 году нанес сокрушительный удар по многим сотням, новыхпредпринимателей, искавших дополнительные капиталы для расширения производства. Цепнаяреакции распространилась на сектор коммерческих банкой, поскольку банки выдали краткосрочныекредиты под запланированные выпуски акции, которые никогда не были произведены по причинеразрушения рынка акций.

Таким образом, коммерческие банки столкнулись с недостаточно капитализированными заемщиками, не выполнявшими во многих случаях кредитных обязательств, что заставляло банки нервно требовать возврата кредитных средств. В результате неудачи банков ипредпринимателей быстро охладили расцветающую экономику и привели к большим потерямкапитала, закончившимся Большой Депрессией 1930-х.Следствием Большой Депрессии стало создание правительством США Комиссии по Ценнымбумагам и Биржам (SEC), которая издала инструкции о формах представления фирмами информациио финансовом состоянии и результатах своих действий.

Среди множества инструкций SEC былаодна, предписывающая создать правила для бухгалтерского учета в бизнесе, называемыеобщепринятыми принципами бухгалтерского учета (GAAP). Первоначально согласованныеАмериканской Ассоциацией Бухгалтерского учета и Американским Институтом Дипломированныхбухгалтеров, GAAP в настоящее время регулируется Управлением по Стандартам ФинансовогоУчета (FASB) в г. Стамфорд, Штат Коннектикут.После введения GAAP появились веские причины, чтобы заняться анализом финансовойотчетности. Не устраняя личных взаимодействий, важных для отношений любого банка и заемщика,GAAP сделал возможным исследовать прошлую работу фирмы последовательно год за годом. Свведением GAAP, появилась также разумная перспектива того, что различные фирмы будутиспользовать одинаковые концепции в бухгалтерском учете своих действий.Case StudyFIRST NATIONAL BANK OF CHICAGO:COMMITMENT TO QUALITY CUTS COSTS, ADDS CUSTOMERSThe First National Bank of Chicago has proven the skeptics wrong.

The disbelievers have said it isnearly impossible to measure quality in service industries, such as banks, airlines, and insurance companies.For proof that service performance can be measured, analyzed, and improved upon, a doubter need only visitthis banking institution.1л 1981, the First National Bank of Chicago (First Chicago) decided to prove that quality could bemeasured in a service environment. The objective was to increase its share of the market by positioning itselfas the quality provider of corporate cash management services. Cash management services are noncreditservices such as corporate checking, funds transfer, and shareholder service—services that most major banksprovide their customers.Management at First Chicago believed that a strategy focused on quality is the best way any company canrespond to competition. They were also pleasantly surprised lo find that an emphasis on quality helps controlcosts.

At First Chicago, the installation and execution of its quality program has resulted in savings of $7 to$10 million annually.9Facts on First Chicago. First Chicago the 11th largest bank holding company and the 10th largest bank inthe United States when it undertook the quality improvement program, was founded in 1863. It is the oldestand largest national bank operating under its original name and charter. First Chicago has the second highestprimary capital ratio among major money center bank holding companies. The bank is also the third largestissuer of bank credit cards in the United States.There are 13,000 employees working worldwide for First Chicago Corporation, is listed on the New York,Midwest, Pacific, London, and Tokyo exchanges with 11,700 shareholders.

The 57 offices worldwide areorganized into three strategic business areas: global corporate banking; consumer banking; and middle-marketbanking. First Chicago Corporation is the parent company of American National Corporation, the fifth largestbank holding company in Illinois with assets of $4.5 billion.The Need for Quality Becomes Clear. In the old days, the noncredit services of the banking industry wereset up as cost centers, and their products were viewed as "giveaway" services.

The noncredit services wereusually located in the bowels of a bank. They were often referred to flatly as the "back office".But now outside influences are dramatically affecting banks' "front offices". The financial services aspectof banking—for instance, the corporate loan area and trade services—has been affected by US and foreignregulations and substitute products like commercial paper and money market funds. Banks are also beingpushed by new competitors in the arena. These competitors include foreign banks, nonbanks. investmentbanks, and data processing firms.Since 1971, the required return on equity of the banking industry has been on a free-fall decline.

So ifbanks want to stay alive, they must change their business mix, pricing, and/or cost to recover from the currentfree fall.First Chicago has elected to distinguish itself by focusing on products that generate a high return on equity.Included in its plan of attack is a focus on the high quality of services. For example, service and quality arethe key controllable buying determinants in noncredit services, as determined by a major independentresearch firm. So First Chicago is determined to be the best in the noncredit services business."Satisfying customer needs and expectations is the number one reason for being in any business", saysAleta Holub, vice president of quality assurance at First Chicago. "Customer responsiveness and loyalty toproducts and services will ultimately determine a company's success or failure. Customers' standards areconstantly rising.

A company's failure to respond to raised expectations is like denying the force of the tide. Itcan leave you high and dry on the beach, while customers sail off to competitors' ports".Step One in Launching the Quality Effort. The first step the bank took in launching its quality processwas to alter its organizational framework. Separate strategic business units were created, each based on anindividual product family.

For instance, the Money Transfer unit's product family includes all domestic andinternational payment services. The Corporate Trust business unit deals with the indenture trustee andshareholder services product family. The product family under the Documentary Products unit is all import.export, and standby letters of credit, and international documentary collections. Operating under thephilosophy that bringing the producer and consumer of a product closer together encourages better quality,the strategic business unit managers suddenly became entrepreneurs. The managers were vested with thepower to control not only expenses, but also pricing, product features, promotion, and quality. The newstructure provides all the essential elements for the managers to meet customer requirements."The strategic business unit framework brought our managers closer to our customers and made themmore directly accountable for the quality of our products", says Ffolub.Using Specialized Customer Service Personnel.