Corporate finance Books

Book SynopsisIntroduces a range of tools for risk evaluation, risk response and risk governance. This book looks at management of risk to operations across industries, professional disciplines and history to help operations risk leaders become aware of the entire landscape of proven experience, not just their own conference room.Table of ContentsAbout the Author Acknowledgements Preface Foreword-Marshall Carter on Plan B Thinking Introduction Touchstones to Keep Focus on Efficiency and Effectiveness 'Been There, Done That'-the Voice of Experience Bringing it Together Part 1. Evaluating Risk 1.1. Lighting up 'Dark Corners' 1.2. Know the Business: evaluating the environment and the enterprise 1.3. The Right Tool for the Right Risk Type 1.4. Seeking Scenarios: providing more power to see-the 'why' and 'what' 1.5. Creating More Robust Scenarios More Easily-the 'how' 1.6. Evaluating Scenario Quality and Avoiding Bias 1.7. Creating Insightful Single Sources of Risk Information 1.8. Capital Estimates: Trips, Traps and Pitfalls 1.9. Capital and Performance Incentives 1.10. Watch for Warnings 1.11. Key Insights for Evaluating Risk Part 2. Responding to Risks 2.1. Responding to Risk: managing options, finding balance, creating levers 2.2. Prioritizing Improvements 2.3. Strengthening the Institution in its Environment 2.4. Improving Control Capability 2.5. Improving Product Management and Fraud Prevention 2.6. Improving IT-related Business Risk Management 2.7. React and Recover-Right Action at the Right Time 2.8. Key Insights for Responding to Risk Part 3. Oversight of Risk Management 3.1. Oversight of Risk Management 3.2. Four Functions of a Governor 3.3. Key Insights for Oversight and Governing Risk Part 4. You in Your Institution 4.1. Overcoming Barriers to Better Risk Management 4.2. Your Questions for the Board of Directors 4.3. Conclusion: your opportunity to make a difference Index

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Book Synopsis14 comprehensive leveraged buyout case studies

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Book SynopsisThe Student Edition of the inside story of private equity dealmaking.Table of ContentsPrefaceAbbreviations and LexiconIntroductionChapter 1. Tricks of the TradePart One. Asset-Shifting: Secondary Buyouts and their Offspring Chapter 2. Gala Coral - Game on!Part Two. Asset-Flipping: Recaps and Quick Flips, or the Art of Making a Quick BuckChapter 3. Hertz - The Need for SpeedChapter 4. Celanese - Rich ChemistryPart Three. Financial Engineering and the Risks Pyramid Chapter 5. TXU - Power StrugglesChapter 6. EMI - Out of TunePart Four. Repurchases or Relapse Buyouts: Seller's RemorseChapter 7. PHS - Washed-upChapter 8. Frans Bonhomme - Down the DrainPart Five. Listing, Delisting, Relisting: On a Fool's ErrandChapter 9. DX Group - Going PostalChapter 10. Debenhams - Debt Never Goes Out Of Fashion Part Six. Private Investments in Public Equity: PIPE Dream or Nightmare?Chapter 11. PagesJaunes - The French DisconnectionChapter 12. Seat Pagine Gialle - The Italian JobPart Seven. PE-backed IPOs: The Search for a PatsyChapter 13. eDreams - Reality Fights BackChapter 14. Foxtons - Timing the MarketPart Eight. Asset-Stripping: Modern-day Creative Destruction Chapter 15. Caesars Entertainment - PE's Version of Strip Poker Part Nine. Trick or TreatEpilogue. Sheriffs and CowboysAcknowledgementsAbout the authorEndnotesIndex

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Book SynopsisThis is the essential book for all who need to know about the new detailed regulations for margining in the European Union and the USA and most of all need to understand the contents of these two credit support annexes so that they can negotiate them safely and confidently.Trade ReviewThe global regulatory pressure to create new standardized documentation for the complicated and arcane process of posting variation margin has been extraordinary. In response, ISDA issued two standard forms of Credit Support Annexes for Variation Margin. Thankfully for neophytes and experts alike, Paul Harding and Abigail Harding have provided a rosetta stone for understanding these new forms and the regulations and regulatory environment surrounding them. This new practice guide provides an articulate, cogent and comprehensive discussion of these issues and the regulations driving their creation, complete with a thorough annotation of each of the provisions in the two 2016 Credit Support Annexes. No derivative documentation specialist or practitioner’s bookshelf will be complete without it. --Christian A Johnson, Dean and Professor of Law, Widener University Commonwealth Law SchoolTable of ContentsThe new regulatory scene for OTC derivatives and collateral The 2016 ISDA Credit Support Annex For Variation Margin (VM) under English Law The 2016 ISDA Credit Support Annex For Variation Margin (VM) under New York Law Important developments since the global financial crisis

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Book SynopsisThis fully revised, updated and expanded edition of the industry standard text takes the reader through the complete life cycle of a syndicated loan. Beginning with the opening phase of mandating a lead bank, Syndicated Lending delves through negotiation, documentation, syndication and closing transactions to conclude with the secondary market.This seventh edition includes new supplements dealing with:regional syndicated loan marketsgrowing regulatory frameworkthe influence of Brexit on the marketthe challenges thrown up by the transition from LIBOR-based pricing to the proposed risk-free rate environment.The practice of syndicated lending is similarly explored in its historical context, by following the ups and downs of this most flexible, and enduring, financial market. Plus, while the market moves toward digitisation, summaries are provided for the leading technology solutions being developed.With practical explanations, reflecting practices developed by the LMA, from borrowers, bankers and investors, this book offers insight from industry professionals with decades of experience as well as detailed examples of pricing methodology. There is also an up-to-date discussion of documentary issues, including annotated term sheets and loan documents, contributed by Clifford Chance.This is the essential guide to the commercial and documentary aspects of syndicated lending for lenders, borrowers, investors, lawyers, regulators and service providers.

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Book SynopsisPlanet VC uncovers the story of how VC went global, transforming cities from Beijing to Bangalore into the techno-hubs of tomorrow.

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Book SynopsisFour out of five businesses fail due to cash problems needlessly. Every business owner has the tools to accurately forecast cash flow, they just don't know it. Financial Forecasting in Microsoft Excel shows small- to medium-sized businesses how to achieve the same forecasting power as larger companies.Trade Review"Forecasts must be meaningful and explainable. Jeff Prager's financial mastery has allowed my companies to make profitable decisions, change course when necessary and maintain relevance in our industry for more than 20 years." -- Joel Farkas, Principal, Gateway American Resources Denver, CO

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Book SynopsisBy the time you compare your accounting reports with your job costing, estimating and change orders, and pipeline, it's too late to make adjustments to guarantee profit. This book will help you see where you stand every day, with every job, by monitoring just 7 Key Numbers that drive all profits and cash flow.Trade Review"Managing Your Business with 7 Key Numbers is exceptionally well written, organized, and presented. Specifically directed at professionals engaged in construction, Managing Your Business with 7 Key Numbers is as thoroughly 'user friendly' as it is informative, making it very highly recommended." -- Small Press Bookwatch, Oregon, WI

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Book SynopsisEmployee Ownership and Shared Capitalism illuminates shared capitalism's complexity as an organizational, psychological, sociological, and economic phenomenon that requires deep interdisciplinary understanding.Table of ContentsChapter 1. Employee Ownership and Shared Capitalism: Assessing the Experience, Research, and Policy Implicationsby Edward J. CarberrySection I: Organized Labor and Shared CapitalismChapter 2. Solidarity and Sharing: Unions and Shared Capitalism by John E. McCarthy, Paula Voos, Adrienne.E. Eaton, Douglas L. Kruse, and Joseph R. BlasiChapter 3. Improving the Quality of Home Health Aide Jobs: A Collaboration between Organized Labor and a Worker Cooperativeby Daphne Perkins Beny and Stu SchneiderChapter 4. Shared Capitalism, Corporate Disclosure, and Management's Incentive to Signal a Positive Outlookby Francesco BovaSection II: New Theoretical and Empirical ApproachesChapter 5. Employee Ownership, Democratic Control, and Working-Class Empowermentby Joan S. M. MeyersChapter 6. An Empirical Analysis of Risk Preferences, Compensation Risk, and Employee Outcomes by Fidan Ana Kurtulus, Douglas L. Kruse, and Joseph R. BlasiChapter 7. Employee Ownership and Corporate Performance: Toward Unlocking the Black Boxby Marco CaramelliChapter 8. The Determinants and Consequences of Broad-Based Stock Option Plans: The View from Economics and Financeby Serdar Aldatmaz and Paige OuimetSection Ill: Assessing the Experience of Shared Capitalism in Different National ContextsChapter 9. Assessing Mondragon: Stability and Managed Change in the Face of Globalizationby Saioa Arando, Fred Freundlich, Monica Gago, Derek C. Jones, and Takao KatoChapter 10. Ohio's ESOP Companies Through Two Decades: Growing Up or Growing Old?by John Logue and Jacquelyn YatesChapter 11. Employee Ownership in Britain: Diverse Forms, Diverse Antecedentsby Andrew PendletonAbout the Contributors

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Book SynopsisThis Element investigates the historical and systemic roots of hedge-fund activism. It argues that the spirit of the New Deal financial regulations was subverted in the 1980s and 1990s in the name of shareholder democracy and opened the door for the rise of hedge-fund activism. It analyzes the effects of regulatory reforms including the introduction of compulsory voting by institutional investors, proxy-voting rule changes that greatly facilitated aggregation of the proxy votes of institutional investors, and rules that allow hedge funds to draw effectively limitless alternative investments from institutional investors. This Element also evaluates the recent empirical research on hedge-fund activism and explains why shareholder activism has gone awry. It argues that the regulatory changes created a large vacuum in the arena of corporate voting that hedge-fund activists can effectively exploit for their own profits. It concludes with policy proposals for rebuilding the proxy-voting and engagement system.

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Book SynopsisThis book introduces three innovative concepts and associated financial instruments with the potential to revolutionise real estate finance.The factorisation of commercial real estate with factor-based real estate derivatives is the first concept analysed in this book. Methodological issues pertaining to factors in real estate risk analysis are covered in detail with in-depth academic reference. The book then analyses the digitalisation of commercial real estate. The environment in which buildings operate is changing fast. Cities which used to be made up of inanimate architectural structures are growing digital skins and becoming smarter. Smart technologies applied to the built environment are fundamentally changing buildings' role in cities and their interactions with their occupants. The book introduces the concept of smart space and analyses the emergence of digital rights' or property rights for smart buildings in smart environments. It proposes concepts and methods for iTable of Contents1. The factorisation of commercial real estate: factor-based real estate derivatives 2. The digitalisation of commercial real estate: smart space as real estate finance’s new asset 3. The tokenisation of commercial real estate: tokens as a new tool in financial engineering applied to real assets

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Book SynopsisWhat are the criteria used by Financial Action Task Force (FATF) and the European Union to blacklist jurisdictions at high-risk of money laundering? What are the countries at highest risk according to Panama Papers and FinCEN files? Where do criminals move their illicit money, according to judicial and investigative evidence? This book answers these questions. It is an unprecedented study on the countries at highest risk of attracting money laundering and organised crime proceeds â and how they are identified as such by scholars, policy-makers and anti-money laundering (AML) practitioners. It targets an issue which is central to the policy debate, in the media, but is under-studied. This book is divided into two parts. Part I discusses the concept of money laundering risk, its main determinants, and carries out a review of extant country ratings, ranging from official blacklists and grey lists, to media leaks and scholarly papers. Part II discusses the weaknesseTrade Review"For too long, for money laundering and the policies to counter it have been 'an evidence-free zone', with lots of politics, hypocrisy and guess-work covering our enormous ignorance. Riccardi's book is a huge step forward in fixing this sad state of affairs. Money Laundering Blacklists takes an original, rigorous approach in transforming our understanding of where the real risks of dirty money lie, and how the fight against illicit finance should be re-focused. It's rare that a book can be so important and compelling for both scholars and policy-makers, but Riccardi has achieved this rare feat".Jason Sharman, Sir Patrick Sheehy Professor of International Relations University of Cambridge"For a nation to be blacklisted for anything is troubling. To be blacklisted for an activity as apparently serious as failure to control money laundering is deeply troubling. Yet, Michele Riccardi's scholarly but very readable book shows that the label is usually applied by official bodies in an arbitrary and unhelpful way. Riccardi offers a theoretically informed empirical approach to testing whether a country truly belongs on a money laundering blacklist".Peter Reuter, Distinguished Professor of Public Policy and Criminology at the University of Maryland"This book reminds us that the current state of the art on assessing national anti-money laundering risk is woefully insufficient. It usefully proposes defining AML risk from the perspective of the viewing country and dispenses with the canard that small and poor countries are the main AML problem, when in fact large, rich countries hold the lion’s share of the world’s dirty money".Charles W Littrell, Inspector of Banks and Trust Companies, Central Bank of The Bahamas"With money laundering risk assessments increasingly seen as the cornerstone of an effective framework to tackle financial crime, this book provides a timely analysis of existing blacklists and approaches to measure risks. It challenges and demystifies many of the methods while offering concrete and promising solutions to assess money laundering risks, taking into account how criminals move dirty money across borders and the role of both source and destination countries".Maíra Martini, Leader of AML and Beneficial Ownership research & policy, Transparency InternationalTable of ContentsList of figuresList of tablesAcknowledgmentsList of abbreviationsIntroductionPART I: Money laundering risk measures Money laundering risk and determinants Money laundering (and illicit financial flows) Money laundering risk Determinants of money laundering risk across countries: proximity, opacity, and security Available measures of money laundering risk Money laundering blacklists and grey lists Origin and scope of anti-money laundering blacklists The FATF blacklist and grey list The US INCSR list The European Union anti-money laundering blacklist Blacklists and sanctions Other lists of high-risk countries Lists based on judicial investigations Lists based on media investigations: from Panama Papers to FinCEN files Lists based on financial/corporate data analyses Lists based on crime data analyses Composite indicators Lists developed by banks and other obliged entities Relations and underlying components of existing risk ratings Summary: the gaps in existing risk ratings and blacklists PART II: A New measurement approach A new approach to identify countries at high-risk of money laundering Rationale Methodology and operationalisation A practical application: money laundering risk from the perspective of Italy Discussion and policy implications Discussion Policy implications Limitations and future research directions AppendixReferencesIndex

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Book SynopsisHow can you be sure you are buying the company you think you are? Are you sure it is as good as the seller says? How can you be certain unexpected costs and obligations will not suddenly appear once you are the owner and responsible for them? How best can you arm yourself for the negotiations? Have you worked out precisely what you are going to do with it once it is yours? How do you set the priorities for change to recoup the premium you have paid for it? The answer to all these questions, and many more, lies within a series of three comprehensive yet concise volumes by Peter Howson.The Essentials of M&A Due Diligence, the first in the series, is a must for anyone who needs to master the essentials of due diligence with the minimum effort and in the minimum amount of time. Straightforward and unbiased, it sets out the fundamentals of pre-acquisition investigations, showing which are appropriate and why.Table of ContentsList of illustrationsChapter 1: IntroductionChapter 2: Getting startedChapter 3: Working with advisersChapter 4: Financial due diligenceChapter 5: Legal due diligenceChapter 6: Commercial due diligenceChapter 7: Human Resources due diligenceChapter 8: Management due diligenceChapter 9: Pensions due diligenceChapter 10: Tax due diligenceChapter 11: Environmental due diligenceChapter 12: IT due diligenceChapter 13: Technology due diligenceChapter 14: Intellectual property due diligenceChapter 15: Anti-trust due diligence

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Book SynopsisSustainable Finance Fundamentals provides an accessible overview of this critical, rapidly growing area at the intersection of finance and sustainability.The first part showcases different approaches to sustainable finance, covering banking, impact investing, integrated reporting and strategy, and risk management. The second part covers investing, including equity, green bonds, and crowdfunding. In the final part, issues beyond sustainable finance, such as alternative investments, renewable energy, and innovation, are explored. In addition, two optional appendices provide useful introductions to the time value of money (TVM) and financial statements.Ethical and regulatory issues are addressed holistically throughout the book and sustainable finance is linked to related topics, such as environmental economics and the UN Sustainable Development Goals. Each chapter has an international focus and features examples, in a nutshell summaries, and discussion questionsTable of Contents1. Introduction 2. Value creation through sustainable finance 3. Financial institutions 4. Different approaches to sustainable finance 5. The basics of reporting 6. Equity ownership 7. Bonds in different colors, shapes, and sizes 8. Indices and passive investments 9. Alternative assets 10. Insurance and risk 11. Carbon markets 12. Transition to clean energy 13. Innovation, a path to follow

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Book SynopsisThis book provides an interdisciplinary critical perspective regarding risk, uncertainty and governance challenges of cryptocurrencies. It considers the perspectives of several disciplines including accounting, cybersecurity, cyberlaw, economics, ethics, finance, financial regulation, Shariah (Islamic) law and technology. Different from other books on a similar topic, this book's in-depth analysis and critical discourse on cryptocurrency risk categories are supplemented by research evidence gathered from surveys and interviews with stakeholders. The inclusion of an Islamic insight matters given mixed views at present regarding the permissibility of cryptocurrencies and some countries have indeed imposed somewhat restricted functions of cryptocurrencies for non-religious reasons. It is envisaged that this book will help enlighten stakeholders on this aspect of uncertainty and inspire fit and proper governance strategies for the public interest.

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Book SynopsisThis book explores the swiftly emerging nexus between sustainability, finance, and technology.Leading practitioners and academic thought leaders reflect on the ways in which technology and digitalization shape how sustainable finance professionals address environmental, social, and governance (ESG) issues. Together, the contributors identify three spheres in which technology shapes how investors make sense of such issues: ESG and technology: finance professionals need to know about how technological innovations, such as chemical recycling for plastics, in the real economy shape firms' ESG performance; ESG through technology: technological developments, such as AI and blockchain, can enable finance professionals to offer more fine-grained ESG analyses; and ESG as technology: the ESG agenda itself is influenced by technological developments that are not well understood by practitioners (e.g., data mining for Bitcoin creating significant emissions). <Trade Review"Bril, Kell, and Rasche have edited a timely, insightful, and deeply thought-provoking volume on a topic that sits right at the frontier of our current knowledge: the interrelation of sustainable finance and technology. It fills an important void by focusing on the real-world implementation of urgently needed solutions to our most pressing sustainability challenges. This book, therefore, is an absolutely essential read for companies, executives, and investors who are genuinely interested in bringing about transformational ESG change in their organizations and indeed, within society at large." Ioannis Ioannou, London Business School "A great book and blueprint for our transition to a more sustainable future." Rose Marcario, former CEO Patagonia "As the founder Executive Director of the UN Global Compact, Georg Kell’s unique insights have shaped the discourse in responsible business since the inception of the Global Compact in 2000. In this publication, Georg Kell and colleagues aptly capture the opportunities in innovative financing, technologies and accountability frameworks that raise the ambition for the private sector." Sanda Ojiambo, CEO and Executive Director, UN Global Compact "The climate and sustainability challenge is the toughest, and most important, one modern society needs to address. But what made society modern is the force of technology. Reconciling the urgency of one with the potential (and peril) of the other is a critical imperative. This anthology draws together key voices to help bridge that gap." Azeem Azhar, author, Exponential "Have you been wondering about ESG and how technology might be part of the solution? Then this might be a worthwhile read for you. My colleagues across asset management and academia have written the book with complementing chapters about futuristic views on technology impact, paired with how asset managers might integrate technology and digitalisation in the still virgin ESG analytic work. The book also raises important questions about the ESG implications on reverse globalisation and the impact on geopolitics – relevance underlined by the recent events in Ukraine." Peter Branner, Chief Investment Officer APG Asset Management Table of Contents1. Sustainable Finance and Technology: Making the Connection; Part I: ESG and Technology 2. History of Technology and Its Future in the Context of Human Development; 3. ESG—A Transformational Journey for Asset Management, Industries, Technology, and Society; 4. How Can Corporate Leverage Tech and Sustainability through Collaboration? Digital with Purpose—Current Practices and Trends; 5. Decarbonization as a Chance; 6. Ocean Technology as a Growing Space in Which to Reimagine Business: The Role of Start-Ups; Part II: ESG as and through Technology 7. Mitigating the Risks and Nurturing the Opportunities: Data and Tech Vital in Tackling Companies' ESG Challenges; 8. Resilience as an Analytical Filter for ESG Data; 9. Technology-Supported Investment Management; 10. Finance, Sustainability, and Technology: Co-Evolution in Asset Owners’ Context; 11. A Digital Twin for Finance: Artificial Intelligence Supporting the Implementation of Environmental, Social, and Governance Targets; 12. Efficiently Allocating Capital to Transition to a Sustainable Economy; 13. Assessing ESG from a Position of Wealth; 14. The Rise of ESG Data: A Tectonic Transparency Shift; 15. ESGT—Exponential Technology Requires Exponential Responsibility; 16. Mastering Sustainability Requires Technology, Finance, and the Powers of Homo Deus

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Book SynopsisThe ongoing digital transformation is shaping the Islamic mode of financial intermediation and the impact on the faith-based financial mode has been multifaceted. This has raised a host of interesting questions: what is the degree of penetration of Islamic finance in the fintech industry? Are Islamic financial institutions (IFIs) or banks ready to embrace fintech? Is fintech an enabler or barrier to achieve the intended purpose of Islamic finance? Will technology narrow the division between Islamic and conventional finance in the future? These are existential questions for Islamic finance and the book endeavors to examine the impact of financial technology on the industry.The book assesses various fintech business models and how they could be a threat or an opportunity. It also examines whether fintech provides IFIs an edge to serve clients following the Shariah norms and how the adoption of fintech in the Islamic mode is required for meeting the maqasid Al Shariah. The book Trade Review‘The book can be considered a guiding companion for those who are concerned about fintech.’ Dr Mohd Daud Bakar, Founder of Amanie Group & International Islamic Finance Advisor‘The book provides students, academics, scholars, and practitioners with a detailed description of theoretical and philosophical speculations on digital transformation in Islamic finance.’Abu Umar Faruq Ahmad, Chair, Shariah Governance Curriculum Review Committee, AAOIFI‘The book offers an important insight as to how technology is going to shape the future of finance.’Professor Dr Mohammad Hashim Kamali, Founding CEO, International Institute of Advanced Islamic Studies (IAIS), MalaysiaTable of ContentsIntroduction Part I Theoretical and Philosophical Speculations on Digital Transformation in Islamic Finance 1. Digital Transformation in Islamic Finance: A Critique of Perfectionist’s Views on Islamic Fintech 2. A Typology of Financial Business Models on Digital Transformation: Expected Impacts on Commercial Banks 3. Fintech, Technomania and Persistent Socio-Civilizational Challenges Part II Empirical Studies 4. Business Risk Mitigation through "Value-Chain Integrated" Financing in Islamic Peer to Peer Lending in Indonesia: PT Qazwa Mitra Hasanah’s Experience 5. Prospects and Opportunities of Islamic Crowdfunding in Bangladesh Anik 6. Empirical Assessment on Digital Transformation in Islamic Banking 7. Fintech in Islamic Banking in Bangladesh: Opportunities and Threats 8. Islamic digital banking in the Netherlands – Challenges and Opportunities 9. Can Islamic FinTech Best Serve the Migrants’ Interest in Remittance Services? The South and South-East Asian Perspective 10. The impact of central bank digital currency (CBDC) on the operations of Islamic Banks 11. Takafultech Reflects the Maqasid al-Shariah Ethos in Takaful 12. Digital Transformation and Accounting Issues in Takaful: The Case of Indonesia 13. Dilemma and Challenges for fintech application in Waqf Administration / Regulation in contemporary Muslim majority countries: A Case of Bangladesh 14. Breaking the barriers of Zakat Management System through Islamic Fintech: The Case of Bangladesh 15. An inquiry into the application of Artificial Intelligence on Fatwa. Conclusion.

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Book SynopsisThe first introductory practical guide of its kind, this book brings together principles of corporate governance, investor stewardship and enterprise sustainability in the context of institutional investment.Stewardship codes are developing in diverse markets to provide a framework for responsible institutional investment practices and fiduciary duties for beneficiaries. While codes provide a starting point, the application of stewardship in practical terms can be challenging for many institutional investors. Written by two well-known corporate governance experts, George Dallas and Mike Lubrano, and based on the ICGN training course on stewardship that they developed, this book gives needed clarity, rigor and guidance to practitioners about what we knowand don''t knowabout stewardship, governance and sustainability. It explores the theoretical foundations of stewardship, linking these to day-to-day decision-making and providing real-life examples and practical toolsTrade Review"Practical, but underpinned by an excellent understanding of the theory and scientific research! I can’t think of a better duo to capture the essence of the ongoing debate on the relationship between governance and sustainability. Mike and George, given their experience and exposure to a wide range of issues in different parts of the world, as pioneers of good corporate governance in the early 2000s, are uniquely positioned to explain what matters and why in different contexts, and to offer stewardship guidance to investors. I also recommend this book to serving directors, investor relations professionals and corporate communications teams."—Prof. Dr. Melsa Ararat, Director, Sabancı University Corporate Governance Forum; Member, ICGN Board."Investors have long known how to trade. But they are only now embracing how to own company shares to make sure boards steer responsible value creation over the long term. That’s where investor stewardship comes in. Dallas and Lubrano have written the world’s first comprehensive guidebook on the toolkit investors can use to safeguard the financial and social interests of citizen savers. With kudos to the International Corporate Governance Network for publishing, this a vital, must-read manual for professionals in the rising field of stewardship."—Stephen Davis, Ph.D., Associate Director and Senior Fellow, Harvard Law School Programs on Corporate Governance and Institutional Investors"Dallas and Lubrano’s guide to stewardship is concise, evidence-based and implementable. Responsible investors should read it from cover to cover. I recommend it strongly." —Professor Elroy Dimson, Centre for Endowment Asset Management, Cambridge Judge Business School."This book gives not only the ICGN members but all governance practitioners around the globe an excellent way of in depth understanding the necessities and practical requirements for being a sustainable and successful pursuer of good governance and stewardship." —Christian Strenger, Academic Director of the Corporate Governance Institute at the Frankfurt School of Finance"This is a must read for any ESG investor and a should read for any corporate governance, environmental and/or social specialist. George and Mike have effectively weaved current trends of ESG integration and stewardship into the complex corporate governance ecosystem. This modern look at corporate governance is refreshing and quite palatable even to the general public or layperson seeking to find out what is ESG."—Charles T. Canfield, Principal Corporate Governance Officer, International Finance Corporation (World Bank Group)"As an investor you can easily get lost nowadays in how best to integrate ESG in your investment practice, contribute to the SDGs and report in accordance with TCFD, SASB or GRI. In ‘Governance, Stewardship and Sustainability’ the authors Dallas and Lubrano not only explain this ‘alphabet soup’ in a concise and practical fashion but also help you understand what you need to do as an investor to continue doing well while doing good."— Martin Steindl, ESG Manager, FMO (The Dutch Development Bank)"This book is filled with ICGN's wisdom, which has had a huge influence on Japanese corporate governance and investor stewardship. As sustainability and ESG issues continue to develop and have greater prominence for both companies and investors, this book provides practical path to guide investors in how to realise their stewardship responsibilities." — George Iguchi, Chief Corporate Governance Officer, Nissay Asset Management and ICGN Board Governor.Table of ContentsForeword Preface to the second edition Preface to the first edition Background of the authors 1. Theory and Practice of Stewardship and Sustainability 2. Basic Principles of Corporate Governance: Investor Expectations and Corporate Realities 3. The Case for Stewardship and Sustainability: Ethics and Economics 4. Sources of ESG Data, Standards and Ratings: Making Sense of them for Investors and Companies 5. ESG and Investment Decision-Making: Designing and Effective Methodology 6. Effective Stewardship in Practice: Monitoring, Engaging, Voting and Reporting 7. Company Perspective: Sustainability Governance and Reporting 8. Case Study: Volkswagen’s DieselGate: Corporate Governance and Sustainability Index

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Book SynopsisNow in its fourth edition, Finance: The Basics is a clear and practical introduction to the world of finance. It thoroughly explains essential financial statements, tools, and concepts; fundamental financial instruments and transactions; and global financial participants, markets, and systems. This fully revised edition captures the most important aspects of a changing financial landscape, including: A new chapter dedicated to the emerging world of digital currencies, with a review of digital finance and a detailed discussion of regulated and unregulated digital currencies (including cryptocurrencies) New sections dealing with a range of social issues that directly impact on finance, including sustainability; environmental, social, and governance (ESG) and socially responsible investing (SRI) imperatives; microfinance; and impact investing Twelve updated real-world case studies ('Finance in Action' studies) and nine new case studies focuseTable of ContentsPART 1: Concepts and tools 1. The world of finance 2. The financial statements 3. Financial concepts and tools PART 2: Instruments and marketplaces 4. Common and preferred stock 5. Loans and bonds 6. Investment funds 7. Derivatives and insurance 8. Corporate finance 9. Digital Currencies 10. Financial Participations 11. The Global Financial Markets

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Book SynopsisThis book questions the ability of crowdfunding (especially in the lending and equity-based models) to contribute to the development of European businesses, and therefore, to the relaunch of the European economy. Following a mainly micro (firm-based) approach, the study investigates the advantages of crowd investors' increased role both in making financial resources available to the industrial base, thus reinvigorating economic growth across the European Union.The book reframes contemporary issues surrounding corporate finance and develops relevant knowledge to help companies succeed when it comes to securing the means to grow. It provides new and interesting insights into the alternative finance market, in light of the global financial crisis and the COVID-19 pandemic. The book describes the main alternative finance models which include not only lending and equity-based crowdfunding, but also marketplace lending, balance sheet lending, invoice trading, securities, real estat

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Book SynopsisSustainability Reporting: Theory and Practice provides a comprehensive guide to understanding and applying the latest global framework for disclosing sustainability-related risks and opportunities by public-sector business entities, irrespective of whether the entity follows IFRS or GAAP. It serves as a practical resource on sustainability disclosure and provides real-life case studies and illustrative examples for students and practitioners to grasp the latest developments in sustainability.This book provides guidance and examples on how to prepare and present high-quality sustainability reports that meet the needs and expectations of various stakeholders, such as investors, regulators, customers and employees. It also offers a clear distinction between the scope and application of IFRS Sustainability Disclosure Standards (Shareholder-Focused) and GRI Standards (Stakeholder-Focused), allowing students to gain the skills required to undertake sustainability reporting.

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Book SynopsisA groundbreaking exploration into the intricate art of business turnarounds and swift recovery â qualified by a careerâs worth of insights â in Your Turn the message is startlingly clear: a turnaround is a one-chance-only experience. This is âdo or die,â and if you understand that in time and act accordingly by following a robust, comprehensive, data-driven approach to survival, your company stands a good chance of weathering the storm.Your Turn is a practical guide for executives to lead their own business turnarounds. With meticulous detail and respected leadership insights, the author has built a step-by-step approach that has served him well in delivering successful business turnarounds.Packed with real-world business examples and instructive models, Your Turn is an indispensable resource for CEOs, board members and senior leadership looking to drag their company out of a distressed situation and back into a thriving enterprise.

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Book SynopsisCorporate Finance for Lawyers explores the intricate relationship between law and corporate finance. Utilising the ‘Financial Mindmap’ throughout, chapters depict financial concepts by using colours and visualisations in a clear and intuitive manner.Trade Review‘Using an easy to follow financial tool the authors explain how key elements of corporate finance including leverage finance, company valuations, secured lending and non-interest bearing finance work and interrelate, how returns are achieved and what terms like enterprise value and working capital really mean. They do so in an innovative way drawing together finance theory and the reality of practice to produce what is likely to be a key foundation text not just for corporate lawyers but all those working in the world of M&A and finance.’ -- Chris Hale, Chair Emeritus, Private Equity and Financial Sponsors‘This work presents a great utility in how it addresses issues affecting businesses from legal, economic, financial and accounting perspectives from the moment of setting up to when a business experiences financial difficulties. The treatment is holistic, the materials from impeccable sources and the arguments firmly grounded in the authors' many years of experience. Without doubt, it is an important and timely text.’ -- Paul Omar, De Montfort Leicester Law School, UKTable of ContentsContents: 1 Introduction to law and corporate finance Rolef de Weijs 2. Does leverage create value? Rolef de Weijs 3. Corporate finance and company valuation: why cash became king Joost de Vries and Rolef de Weijs 4. Discounted cash flow valuation and indirect cash flow analyses: retracing the cash Joost de Vries 5. Secured credit and its use: distinguishing between productive and non-productive credit Rolef de Weijs 6 Hybrid finance by means of shareholder loans Rolef de Weijs 7. Financing through shareholder guarantees Aart Jonkers 8 Reorganisation procedures Aart Jonkers and Rolef de Weijs Index

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Book SynopsisThe Short Introduction to Corporate Finance provides an accessibly written guide to contemporary financial institutional practice. Rau deploys both his professional expertise and experience of teaching MBA and graduate-level courses to produce a lively discussion of the key concepts of finance, liberally illustrated with real-world examples. Built around six essential paradigms, he builds an integrated framework covering all the major ideas in finance over the past half-century. Ideal for students and practitioners alike, it will become core reading for anyone aspiring to become an effective manager.Trade Review'Raghavendra Rau has written a witty and thoroughly accessible introduction to how financial markets work and why they may fail to deliver. Highly recommended.' Sanjeev Goyal FBA, Fellow at Christ's College, University of Cambridge'To laypersons, finance often sounds like a bewildering array of jargon. Rau brilliantly explains key finance concepts using vivid real-world examples. Importantly, the material is accessible to a broad population. Thus, this is a unique text which should have wide-ranging appeal for beginners trying to obtain their first exposure to finance.' Avanidhar Subrahmanyam, Goldyne and Irwin Hearsh Chair in Money and Banking, Anderson School of Management, University of California, Los Angeles'Long overdue and very much welcome, Professor Rau's new handbook on the investment and financing decisions of a firm is logical, elegant, and remarkably easy to read. Reducing what we need to know into the six big ideas of corporate finance is bold, but audiences populated by undergraduates, graduate students or executives alike seeing it all for the first time will appreciate the simplicity. His humorous quips scattered throughout surely help to lift the burden of our field's more difficult concepts.' Andrew Karolyi, Harold Bierman Jr Distinguished Professor of Management, Cornell University, New York'Professor Rau successfully distils Corporate Finance into six basic ideas and through an understanding of these core tenets he has been able to cut through much of the complexity of Corporate Finance theory. Each of the six areas are explained in considerable detail but without an over reliance on mathematical models. The book will be equally valuable for financial professionals, students of finance theory and layman who are simply interested in how financial markets work.' Paul Warren, Clare College, University of Cambridge'Raghavendra Rau opens the gateway to an understanding of corporate finance in this book, moving us lucidly towards that nirvana of universal financial literacy - when people will not need a priesthood to work the world of finance for them. This gem of a book should be compulsory reading for everyone.' Indira Rajaraman, World Resources Institute, India and formerly a Member of the Thirteenth Finance Commission'Professor Rau provides a concise, coherent introduction to corporate finance that should be essential reading for current and aspiring managers. The text is interjected with examples that borrow from pop culture, which are only accentuated by Professor Rau's biting wit and quirky charm.' Kathleen M. Kahle, University of ArizonaTable of ContentsPreface; Acknowledgements; 1. Who are the players in corporate finance?; 2. NPV and the investment decision of the firm; 3. Portfolio theory and the discount rate; 4. Capital structure theory; 5. Option pricing theory; 6. Asymmetric information; 7. Market efficiency; 8. Wrapping it up; Index.

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Book SynopsisThis book explores the foundations and evolution of modern corporate fiduciary law in the United States and the United Kingdom. Today US and UK fiduciary law provide very different approaches to the regulation of directorial behaviour. However, as the book shows, the law in both jurisdictions borrowed from the same sources in eighteenth- and nineteenth-century English fiduciary and commercial law. The book identifies the shared legal foundations and authorities and explores the drivers of corporate fiduciary law''s contemporary divergence. In so doing it challenges the prevailing accounts of corporate legal change and stability in the US and the UK.Table of ContentsIntroduction: corporate legal ideas; Part I. Business Judgment and the Idea of Honesty in the Exercise of Delegated Power: 1. Business judgments: origins; 2. Business judgments in UK corporate law; 3. The foundations of the business judgement rule in the United States; 4. The structural dissonance of Delaware's business judgment rule; Part II. The Duty of Care and the Ideas of Reward and Undertaking: 5. Origins: between laxity and terror in bailment and trusts law; 6. The origins of the director's duty of care in the United States; 7. The Delaware duty of care: fragments of jurisprudence; 8. The duty of care in the United Kingdom: in the shadow of gross negligence; Part III. Self-Dealing and the Idea of the Corporation: 9. Conceptions of the corporation; 10. The United Kingdom: contracting out of the common law; 11. The United States: the paths to fairness review; Part IV. Connected Assets and the Idea of Property: 12. Connected assets law in the United Kingdom: the property institution; 13. The modern UK approach and the disappearance of property; 14. Connected assets law in the United States: between property and prescription; 15. Explaining divergent evolution in connected assets law.

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Book SynopsisThe thousands of mergers, acquisitions, and start-ups that have characterized the past years of business have created an increasing number of corporations in financial trouble: specifically, a shortage of venture capital or quick cash. Consequently, bankruptcy protection is now viewed as a strategic move to protect corporations from their creditors and allow them to reorganize. Fully revised and updated with new case studies and the latest coverage of regulations, Bankruptcy and Insolvency Taxation, Fourth Edition provides the answers to the questions financial managers will have on the tax aspects of bankruptcy strategy.Table of ContentsPreface ix Chapter One: Nature of Bankruptcy and Insolvency Proceedings 1 1.1 Objectives 2 1.2 Alternatives Available to a Financially Troubled Business 4 Chapter Two: Discharge of Indebtedness 27 2.1 Introduction 30 2.2 Discharge of Indebtedness Income 30 2.3 Determination of Discharge of Indebtedness Income 31 2.4 Section 108(e) Additions to Discharge of Indebtedness Income 46 2.5 Section 108(e) Subtractions from Discharge of Indebtedness Income 66 2.6 Discharge of Indebtedness Income Exclusions 71 2.7 Consequences of Qualifying for Section 108(a) Exclusions 81 2.8 Section 108(i) Deferral and Ratable Inclusion of DOI from Business Indebtedness Discharged by the Reacquisition of a Debt Instrument 97 2.9 Use of Property to Cancel Debt 106 2.10 Consolidated Tax Return Treatment 117 2.11 Discharge of Indebtedness Reporting Requirements 138 Chapter Three: Partnerships and S Corporations: Tax Impact of Workouts and Bankruptcies 143 3.1 Introduction 144 3.2 Partnerships 144 3.3 S Corporations 161 Chapter Four: Taxation of Bankruptcy Estates and Debtors 173 4.1 Introduction 174 4.2 Responsibility for Filing Income Tax Returns 174 4.3 Accounting for the Bankruptcy Estate 177 4.4 Accounting for the Debtor (Individual) 215 4.5 Summary 228 Chapter Five: Corporate Reorganizations 231 5.1 Introduction 232 5.2 Elements Common to Many Reorganization Provisions 233 5.3 Overview of Specific Tax-Free Reorganizations under Section 368 249 5.4 Acquisitive Asset Reorganizations 249 5.5 Stock Acquisitions 261 5.6 Single-Entity Reorganizations 270 5.7 Divisive Reorganizations 275 5.8 Insolvency Reorganizations 286 5.9 Summary 309 Chapter Six: Use of Net Operating Losses 311 6.1 Introduction 313 6.2 I.R.C. Section 381 315 6.3 Restructuring under Prior I.R.C. Section 382 320 6.4 Current I.R.C. Section 382 322 6.5 I.R.C. Section 383: Carryovers Other than Net Operating Losses 396 6.6 I.R.C. Section 384 397 6.7 I.R.C. Section 269: Transactions to Evade or Avoid Tax 401 6.8 Libson Shops Doctrine 406 6.9 Consolidated Return Regulations 407 Chapter Seven: Other Corporate Issues 425 7.1 Introduction 426 7.2 Earnings and Profits 426 7.3 Incorporation 430 7.4 Liquidation 434 7.5 I.R.C. Section 338 440 7.6 Limited Liability Corporation 454 7.7 Other Tax Considerations 454 7.8 Administrative Expenses 457 7.9 Other Administrative Issues 465 Chapter Eight: State and Local Taxes 471 8.1 Introduction 471 8.2 Bankruptcy Estates 472 8.3 Stock for Debt 479 8.4 Cancellation of Indebtedness 479 8.5 Net Operating Loss Carryback and Carryover 480 8.6 Stamp Tax 481 8.7 Tax Impact of Plan for State and Local Purposes 485 Chapter Nine: Tax Consequences to Creditors of Loss from Debt Forgiveness 487 9.1 Introduction 488 9.2 Nature of Losses 488 9.3 Business and Nonbusiness Losses 490 9.4 Determination of Worthlessness 501 9.5 Secured Debt 509 9.6 Reorganization 516 Chapter Ten: Tax Procedures and Litigation 519 10.1 Introduction 520 10.2 Notice and Filing Requirements 520 10.3 Tax Determination 521 10.4 Bankruptcy Courts 575 10.5 Minimization of Tax and Related Payments 578 Chapter Eleven: Tax Priorities and Discharge 581 11.1 Introduction 582 11.2 Priorities 582 11.3 Tax Discharge 635 Chapter Twelve: Tax Preferences and Liens 669 12.1 Introduction 669 12.2 Tax Preferences 669 12.3 Tax Liens 675 About the Authors 703 About the Web Site 704 Statutes Citations 705 Treasury Regulations, Revenue Procedures, and Revenue Rulings Citations 714 Case Index 722 Subject Index 732

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Book SynopsisThe easy way to get started in crowdfund investing Crowdfund investing (CFI) is going to be the next big thing on Wall Street. U.S. investment banks, brokerage houses, and law firms are gearing up for the creation and regulation of new financial products that will be available to the general public starting in early 2013.Table of ContentsIntroduction 1 Part I: Tapping the Potential of Crowdfund Investing 7 Chapter 1: The Crowd’s in Your Corner: Funding or Investing in a Business 9 Chapter 2: Tracing the Origins of Crowdfund Investing 23 Chapter 3: Raising Capital for Your Startup or Small Business with Crowdfund Investing 41 Chapter 4: Becoming Part of the Crowd: Investing with Caution 67 Part II: Planning Your Crowdfund Investing Campaign 83 Chapter 5: Defining Your Goals and Financial Needs 85 Chapter 6: Focusing on Your People: Building Your Crowd and Your Team 109 Chapter 7: Picking a Powerful Crowdfund Investing Platform 127 Chapter 8: Networking Your Way to Successful Funding 141 Part III: Managing Your Crowdfund Investing Campaign 155 Chapter 9: Making Your Pitch 157 Chapter 10: Troubleshooting Campaign Problems 177 Chapter 11: Moving Forward When You Reach Your Funding Target 191 Part IV: Running Your Business with Your Investors in Mind 207 Chapter 12: Communicating with Your Investors 209 Chapter 13: Crowd Mentality: Staying Afloat in the Face of Investor Revolt 219 Chapter 14: Knowing Your Options If Your Plans Go Astray 231 Part V: Becoming a Crowdfund Investor 243 Chapter 15: Evaluating Crowdfund Investing Opportunities 245 Chapter 16: Committing Your Capital 259 Chapter 17: Adding Value: Playing the Right Role as an Investor 271 Chapter 18: Exiting a Crowdfund Investment 283 Part VI: The Part of Tens 293 Chapter 19: Ten Best Practices for a Crowdfund Investing Campaign 295 Chapter 20: Ten Reasons Every Country Should Consider Crowdfund Investing 301 Chapter 21: Ten Crowdfunding Cases 309 Chapter 22: Ten Stories That Inspire 315 Appendix: Resources 321 Index 325

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Book SynopsisAswath Damodaran, distinguished author, Professor of Finance, and David Margolis, Teaching Fellow at the NYU Stern School of Business, have delivered the newest edition of Applied Corporate Finance.Table of ContentsPrefaceAcknowledgementsChapter 1 The FoundationsChapter 2 The Objective in Decision MakingChapter 3 The Basics of RiskChapter 4 Risk Measurement and Hurdle Rates in PracticeChapter 5 Measuring Return on InvestmentsChapter 6 Project Interactions, Side Costs, and Side BenefitsChapter 7 Capital Structure: Overview of the Financing DecisionChapter 8 Capital Structure: The Optimal Financial MixChapter 9 Capital Structure: The Financing DetailsChapter 10 Dividend PolicyChapter 11 Analyzing Cash Returned to StockholdersChapter 12 Valuation: Principles and PracticeAppendix 1Appendix 2Appendix 3Appendix 4

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Book SynopsisWho needs investors? More than two generations ago, the venture capital community VCs, business angels, incubators and others convinced the entrepreneurial world that writing business plans and raising venture capital constituted the twin centerpieces of entrepreneurial endeavor. They did so for good reasons: the sometimes astonishing returns they''ve delivered to their investors and the astonishingly large companies that their ecosystem has created. But the vast majority of fast-growing companies never take any venture capital. So where does the money come from to start and grow their companies? From a much more agreeable and hospitable source, their customers. That''s exactly what Michael Dell, Bill Gates and Banana Republic''s Mel and Patricia Ziegler did to get their companies up and running and turn them into iconic brands. In The Customer Funded Business, best-selling author John Mullins uncovers five novel approaches that scrappy and innoTrade Reviewthere s inspiration aplenty for entrepreneurs looking to do things their own way. (Elite Business, August 2014) Mullins is a good corporate storyteller, which is what makes this book an engaging read. (Financial Times, August 2014) A truly different, but comprehensive way of looking at the issue of funding, this book will set the idea juices flowing. (Talk Business, September 2014) No matter what sort of business you re actually contemplating starting, this is a book you want to read. (Entrepreneur Middle East, September 2014) ..a great book that any aspiring entrepreneur should read. What is says is such good common sense that it s amazing it took so long to be written. (The Telegraph, December 2014)Table of ContentsWhy This Book? xv 1 Craving Crowdfunding? Pandering to VCs? Groveling to Your CFO?: The Magic of Traction and the Customer-Funded Revolution 1 2 Customer-Funded Models: Mirage or Mind-Set? Old or New? 39 3 Buyers and Sellers, but Not Your Goods: Matchmaker Models 70 4 Ask for the Cash: Pay-in-Advance Models 98 5 Recurring Revenue: Subscription and SaaS Models 125 6 Sell Less, Earn More: Scarcity and Flash Sales Models 153 7 Build It for One, Then Sell It to All: Service-to-Product Models 177 8 Make It Happen: Put a Customer-Funded Model to Work in Your Business 205 Acknowledgments 239 Notes 243 About the Research 267 About the Author 271 Index 273

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Book SynopsisStay liquid, think global, and better manage resources with this authoritative guide Working Capital Management is a comprehensive primer on keeping your business financially competitive in the face of limited access to short-term funds. With detailed insight applicable to each phase in the business cycle, this authoritative guide helps managers revamp current practices for more efficient use of assets and liabilities, including more stringent monitoring and planning of collections, disbursements, and balances. Readers will learn how to minimize investments in idle resources, and how to maximize the use of forecast data to better identify risk and the optimal use of available funds. Case studies illustrate the practical applications of the ideas presented, with particular attention given to cash budgeting, forecasting, banking relationships and other common scenarios with specific requirements. Managing a company's short-term resources is both an art and Table of ContentsPreface xiii Acknowledgments xv Chapter 1: Concepts in Working Capital Management 1 Working Capital Concepts 2 Improving Working Capital Management 5 The Significance of Working Capital 8 Cost as the Working Capital Issue 9 Applying These Ideas to a Real Business: Best Buy 12 Summary 15 Notes 16 Chapter 2: Working Capital Ratios and Other Metrics 17 Ratio Analysis 18 Other Ratios and Their Application 22 Other Metrics 23 Benchmarking 27 General Problems in the Use of Ratios and Metrics 29 Summary 32 Notes 32 Chapter 3: Cash—Management and Fraud Prevention 35 Forms of Cash 36 Paper Transactions: Lockboxing 38 Paper Transactions: Depository Accounts 40 Paper Transactions: Controlled Disbursement 41 Electronic Transactions 43 Float and Cost Issues 46 Summary 49 Notes 49 Chapter 4: Cash—Credit and Short‐Term Financial Instruments 51 Developing a Short‐Term Forecast 52 Cash Budgeting 53 Credit Financing 55 Short‐Term Investments 58 Summary 63 Notes 63 Chapter 5: Managing Bank Relationships 65 The Changing Financial Landscape 66 Bank Relationship Management 66 Cash Mobilization in a Multibank Network 68 General Terms of Credit Facilities 71 Specific Terms in Credit Facilities 72 Ongoing Bank Relationship Concerns 75 Summary 77 Notes 78 Appendix to Chapter 5: Selecting Noncredit Banking Services 81 The Request for Proposal 82 RFP Evaluation 85 Chapter 6: Accounts Receivable and Working Capital Issues 89 Elements of Receivables Management 90 Float Opportunities in Managing Receivables 91 Receivables Cycle Monitoring: Ratios 93 Receivables Cycle Monitoring: The Aging Schedule 94 Sales Financing 96 Credit Reporting 97 Terms of Sale 99 Invoice Generation 100 Asset‐Based Financing 102 Debt Collection Agencies 103 Summary 104 Notes 104 Chapter 7: Inventory and Working Capital Issues 107 Elements of Inventory Management 108 Inventory Cycle Monitoring: Ratios 109 Inventory Cycle Monitoring: Metrics 110 The Purchasing Function 112 Analyzing Purchasing Activities 114 EOQ and JIT 116 Work‐in‐Process 118 ABF: Inventory Financing 120 Summary 123 Notes 123 Chapter 8: Payables and Working Capital Issues 125 Elements of Payables Management 126 Payables Cycle Monitoring: Ratios 127 The Accounts Payable Function 128 Payables Using Internal Processes 131 Payables Outsourcing 133 Check Payments in a Comprehensive Payables Environment 135 Payroll Disbursements 136 Summary 138 Notes 139 Chapter 9: International Working Capital 141 Capitalism Goes Global 142 The Financing of International Transactions 144 The Foreign Exchange Markets 145 Country Risk Analysis 151 Other Significant Issues in International Working Capital 152 Cultural and Corporate Practices Affecting Working Capital 154 Summary 156 Notes 156 Chapter 10: Information and Working Capital 159 Information Technology 160 Bank Information Technology 161 Internet Bank Technology 165 ERP: An Alternative Approach 169 Choosing Working Capital Information Systems 171 Summary 175 Notes 176 Chapter 11: Managing the Working Capital Cycle 177 Risk and Working Capital 178 Traditional Risk Management 179 Enterprise Risk Management 179 The ERM Process 180 Efficiency and Working Capital 181 Working Capital and Liquidity 183 Suggested Actions 185 Developments in Working Capital Management 189 The Gizmo Deal: How Delays Turn Profits into Losses 190 Summary 192 Notes 192 Chapter 12: Introduction to Working Capital Cases 195 Sequence of the Cases 195 The Concept of the Working Capital Case 196 Case: Widget Manufacturing 198 Suggested Solutions 207 Note 214 CASES ON WORKING CAPITAL MANAGEMENT 215 Case 1: Dinner Bell Hotel 217 Cash Flow Issues 217 Alternative Actions 219 The “Raw” Data 220 Questions 220 Case 2: Koala Fun 223 The Partners’ First Success 223 Financial Concerns 224 Borrowing Issues 225 Working Capital 225 Final Thoughts 226 Questions 226 Case 3: Miller Building Supplies 229 Joseph Miller Starts MBS 230 Variations in Working Capital Requirements 230 A Banker’s Assistance 231 Questions 231 Case 4: Office Smart 235 The Business of Office Smart 236 Financial Issues 237 Questions 238 Case 5: Quacker Cracker 241 The Attitude toward Debt 242 Financial Planning 242 Questions 244 Case 6: Young Brands 245 Changes in YB’s Global Marketing Strategy 246 Forecasting Considerations 247 Working Capital Issues 247 Financial Issues 248 Questions 248 Appendix I: Basic Financial Concepts 251 Appendix II: Websites of Working Capital Organizations 257 Glossary 261 About the Author 279 Index 281

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Book SynopsisTable of ContentsList of Contributors vii Preface ix Acknowledgements xv Part I Fundamental Ideas, Principles and Approaches 1 1 Risk Assessment with Broad Uncertainty and Knowledge Characterisation: An Illustrating Case Study 3Terje Aven and Roger Flage 2 The Enigma of Knowledge in the Risk Field 27Terje Aven and Marja Ylönen 3 Treatment and Communication of Uncertain Assumptions in (Semi]) quantitative Risk Assessments 49Roger Flage and Christine L. Berner 4 Critical Slowing]down Framework for Monitoring Early Warning Signs of Surprise and Unforeseen Events 81Ivan Damnjanovic and Terje Aven 5 Improving the Foundation and Practice of Uncertainty Analysis: Strengthening Links to Knowledge and Risk 103Terje Aven 6 Completeness Uncertainty: Conceptual Clarification and Treatment 127Torbjørn Bjerga, Terje Aven, and Roger Flage 7 Quality of Risk Assessment: Definition and Verification 143Terje Aven and Enrico Zio 8 Knowledge]driven System Simulation for Scenario Analysis in Risk Assessment 165Pietro Turati, Nicola Pedroni, and Enrico Zio Part II Risk Assessment and Decision Making 221 9 A Decision Support Method for Prioritizing Investments Subject to Uncertainties 223Shital Thekdi and Terje Aven 10 Risk Analysis under Structural Uncertainty 241Sven Ove Hansson Part III Applications 265 11 A Practical Approach to Risk Assessments from Design to Operation of Offshore Oil and Gas Installations 267Vegard L. Tuft, Beate R. Wagnild, and Olga M. Slyngstad 12 A Semi]quantitative Approach for Assessment of Risk Trends in the Norwegian Oil and Gas Industry 297Eirik Bjorheim Abrahamsen, Jon Tømmerås Selvik, Bjørnar Heide, and Jan Erik Vinnem 13 Knowledge Engineering at a Risk]informed Regulatory Agency: Challenges and Suggestions 313Nathan Siu and Kevin Coyne Index 339

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Book SynopsisDetermine a company''s value, what drives it, and how to enhance value during a M&A Valuation for M&A lays out the steps for measuring and managing value creation in non-publicly traded entities, and helps investors, executives, and their advisors determine the optimum strategy to enhance both market value and strategic value and maximize return on investment. As a starting point in planning for a transaction, it is helpful to compute fair market value, which represents a floor value for the seller since it by definition represents a value agreed upon by any hypothetical willing and able buyer and seller. But for M&A, it is more important to compute investment value, which is the value of the target company to a strategic buyer (and which can vary with each prospective buyer). Prepare for the sale and acquisition of a firm Identify, quantify, and qualify the synergies that increase value to strategic buyers Get access to newTable of ContentsPreface xi Dedication and Acknowledgments xv PART I Introduction 1 Chapter 1 Winning through Mergers and Acquisitions 3 Critical Values Shareholders Overlook 5 Stand-Alone Fair Market Value 6 Investment Value to Strategic Buyers 8 Win–Win Benefits of Merger and Acquisition 10 Computation of Cavendish’s Stand-Alone, Fair Market Value 11 Investment Value to Strategic Buyer 12 PART II Building Value 15 Chapter 2 Building Value and Measuring Return on Investment in a Private Company 17 Public Company Value Creation Model 17 Computing Private Company Value Creation and ROI 19 Analyzing Value Creation Strategies 35 Chapter 3 Market and Competitive Analysis 41 Linking Strategic Planning to Building Value 43 Assessing Specific Company Risk 48 Competitive Factors Frequently Encountered in Nonpublic Entities 53 Financial Analysis 54 Conclusion 59 Chapter 4 Merger and Acquisition Market and Planning Process 61 Common Seller and Buyer Motivations 64 Why Mergers and Acquisitions Fail 65 Sales Strategy and Process 67 Acquisition Strategy and Process 78 Due Diligence Preparation 86 Chapter 5 Measuring Synergies 91 Synergy Measurement Process 92 Key Variables in Assessing Synergies 95 Synergy and Advance Planning 96 PART III Measuring Value 99 Chapter 6 Valuation Approaches and Fundamentals 101 Business Valuation Approaches 101 Using the Invested Capital Model to Define the Investment Being Appraised 103 Why Net Cash Flow Measures Value Most Accurately 104 Frequent Need to Negotiate from Earnings Measures 106 Financial Statement Adjustments 109 Managing Investment Risk in Merger and Acquisition 112 Conclusion 117 Chapter 7 Income Approach: Using Expected Future Returns to Establish Value 119 Why Values for Merger and Acquisition Should Be Driven by the Income Approach 119 Two Methods within the Income Approach 121 Three-Stage DCF Model 128 Establishing Defendable Long-Term Growth Rates and Terminal Values 131 DCF Challenges and Applications 133 Chapter 8 Cost of Capital Essentials 135 Cost of Debt Capital 136 Cost of Preferred Stock 138 Cost of Common Stock 138 Fundamentals and Limitations of the Capital Asset Pricing Model 139 Modified Capital Asset Pricing Model 142 Build-Up Model 143 Summary of Rate of Return Data 151 Private Cost of Capital 153 International Cost of Capital 156 How to Develop an Equity Cost for a Target Company 157 Reconciling Discount Rates and P/E Multiples 159 Conclusion 161 Appendix 8A Using Specific Company Risk Strategically 162 Chapter 9 Weighted Average Cost of Capital 169 Iterative Weighted Average Cost of Capital Process 170 Shortcut Weighted Average Cost of Capital Formula 174 Common Errors in Computing Cost of Capital 176 Chapter 10 Market Approach: Using Guideline Public Companies and M&A Transactions 181 Transaction Multiple Method 182 Guideline Public Company Method 186 Selection of Valuation Multiples 190 Commonly Used Market Multiples 191 Chapter 11 Asset Approach 199 Book Value versus Market Value 200 Premises of Value 201 Use of the Asset Approach to Value Noncontrolling Interests 201 Adjusted Book Value Method 202 Specific Steps in Computing Adjusted Book Value 207 Chapter 12 Adjusting Value through Premiums and Discounts 209 Applicability of Premiums and Discounts 210 Application and Derivation of Premiums and Discounts 211 Apply Discretion in the Size of the Adjustment 213 Control versus Lack of Control in Income-Driven Methods 215 Fair Market Value versus Investment Value 215 Chapter 13 Reconciling Initial Value Estimates and Determining Value Conclusion 217 Essential Need for Broad Perspective 217 Income Approach Review 220 Market Approach Review 225 Asset Approach Review 226 Value Reconciliation and Conclusion 228 Checks to Value 231 Candidly Assess Valuation Capabilities 232 Valuation Scenarios – Platform for M&A 232 Appendix 13A Disciplined and Thorough Valuation Analysis Key to Avoiding Failed M&A Deals 235 Analysis of a Hypothetical Synergistic Deal 235 Establishing the Value of an Acquisition Target 236 Establishing Value for the Acquirer 238 Considerations of Other Impacts on Value 239 PART IV Specialty Issues 241 Chapter 14 Exit Planning 243 Why Is Exit Planning So Difficult? 244 What Makes Planning for Your Private Company Investment Unique? 247 Why Should Exit Planning for Your Private Company Begin Now? 249 Exit Planning Process 250 Step 1: Setting Exit Goals 252 Step 2: Owner Readiness 254 Step 3: Type of Exiting Owner 256 Step 4: Exit Options 258 Step 5: Range of Values 263 Step 6: Execution of Exit Plan 265 Chapter 15 Art of the Deal 269 Unique Negotiation Challenges 269 Deal Structure: Stock versus Assets 271 Asset Transaction 276 Terms of Sale: Cash versus Stock 279 Personal Goodwill 282 Bridging the Gap 283 See the Deal from the Other Side 286 Chapter 16 Fairness Opinions 289 Why Are Fairness Opinions Obtained? 291 The Use of Fairness Opinions by Private Companies 294 Parties Who Prepare Fairness Opinions 295 Components of a Fairness Opinion 297 What Fairness Opinions Are Not 301 Conclusion 302 Appendix 16A Sample Fairness Opinion Letter 303 Chapter 17 M&A and Financial Reporting 309 U.S. GAAP and IFRS 310 Relevant FASB and IFRS Statements 311 Reviews by the Audit Firm 312 ASC 820: Fair Value Measurements 313 ASC 805: Business Combinations 315 ASC 350: Goodwill and Other Intangible Assets 325 Incorporating ASC 805 into the Due Diligence Process 326 References 329 Chapter 18 Intangible Asset Valuation 331 Approaches to Valuing Intangible Assets 332 Key Components to Intangible Asset Valuation 334 Intangible Asset Valuation Methods 343 Conclusion 352 Chapter 19 Measuring and Managing Value in High-Tech Start-Ups 353 Why Appraisals of High-Tech Start-Ups Are Essential 353 Key Differences in High-Tech Start-Ups 355 Value Management Begins with Competitive Analysis 356 Stages of Development 358 Risk and Discount Rates 360 Start-Ups and Traditional Valuation Methods 361 QED Survey of Valuation Methods Used by Venture Capitalists 367 A Probability-Weighted Scenario Method to Value Start-Ups 372 Equity Allocation Methods 377 Conclusion 380 Chapter 20 Cross-Border M&A 381 Strategic Buy-Side Considerations 381 Due Diligence 390 Sell-Side Considerations 395 PART V Case Studies 397 Chapter 21 Merger and Acquisition Valuation Case Study – Distribution Company 399 History and Competitive Conditions 400 Potential Buyers 401 General Economic Conditions 402 Specific Industry Conditions 403 Growth 404 Computation of the Stand-Alone Fair Market Value 404 Risk and Value Drivers 409 Summary and Conclusion of Stand-Alone Fair Market Value 418 Computation of Investment Value 420 Suggested Considerations to Case Conclusion 427 Chapter 22 Merger and Acquisition Valuation Case Study –Professional Services Firm 429 Characteristics 429 Valuation Methods 433 Case Study Introduction 435 Potential Buyer 435 Historic Financial Performance 436 Future Expectations 439 Risk and Value Drivers 443 Discounted Cash Flow Method 445 Other Valuation Methods to Consider 445 Suggested Considerations to Case Conclusion 451 About the Authors 453 Glossary 455 Index 465

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Book SynopsisAn intuitive introduction to fundamental corporate finance concepts and methods Lessons in Corporate Finance, Second Edition offers a comprehensive introduction to the subject, using a unique interactive question and answer-based approach. Asking a series of increasingly difficult questions, this text provides both conceptual insight and specific numerical examples. Detailed case studies encourage class discussion and provide real-world context for financial concepts. The book provides a thorough coverage of corporate finance including ratio and pro forma analysis, capital structure theory, investment and financial policy decisions, and valuation and cash flows provides a solid foundational knowledge of essential topics. This revised and updated second edition includes new coverage of the U.S. Tax Cuts and Jobs Act of 2017 and its implications for corporate finance valuation. Written by acclaimed professors from MIT and Tufts University, this innovative Table of ContentsAbout the Authors xiii Acknowledgments xv Preface xvii Chapter 1 Introduction 1 Two Markets: Product and Capital 2 The Basics: Tools and Techniques 3 A Diagram of Corporate Finance 4 A Brief History of Modern Finance 5 Reading This Book 6 Part One Financial Health of a Firm and Cash Flow Management Chapter 2 Determining a Firm’s Financial Health (PIPES-A) 11 The Conversation with the Banker Is Like a Job Interview 11 Starting with the Product Market Strategy 13 Is PIPES Profitable? 14 Doing the Math 14 Sources and Uses of Funds 16 Ratio Analysis 20 The Cash Cycle 26 Summary 28 Chapter 3 Pro Forma Forecasts (PIPES-B) 31 First, Let’s Take a Closer Look at Ratio Analysis 31 Pro Forma Forecasts 33 Circular Relationships 40 Back to (Forecasting) the Future 42 Projecting Out to 2018 and 2019 43 Evaluating the Loan 45 Summary 50 Appendix 3A: Accounting Is Not Economic Reality 52 Chapter 4 The Impact of Seasonality on a Firm’s Funding (PIPES-C) 57 Monthly Pro Forma Income Statements 58 Monthly Pro Forma Balance Sheets 60 A Different Picture of the Firm 68 Summary 72 Appendix 4A: PIPES Monthly Pro Forma Income Statements and Balance Sheets, 2018 73 Appendix 4B: PIPES Monthly Pro Forma Income Statements and Balance Sheets, 2019 76 Part Two Firm Financing and Financial Policies Chapter 5 Why Financing Matters (Massey Ferguson) 81 Product Market Position and Strategy 81 Political Risk and Economies of Scale in Production 82 Massey Ferguson, 1971–1976 83 Sustainable Growth 85 The Period after 1976 87 Conrad Runs Away 90 The Competitors 91 Back to Massey 93 Massey’s Restructuring 96 Postscript: What Happened to Massey 100 Summary 100 Appendix 5A: Massey Ferguson Financial Statements 102 Chapter 6 An Introduction to Capital Structure Theory 107 Optimal Capital Structure 108 M&M and Corporate Finance 111 Taxes 116 Costs of Financial Distress 126 The Textbook View of Capital Structure 131 The Cost of Capital 133 Summary 134 Chapter 7 Capital Structure Decisions (Marriott Corporation and Gary Wilson) 137 Capital Structure 137 The Cost of Capital 144 How Firms Set Capital Structure in Practice 147 Corporate Financial Policies 148 Sustainable Growth and Excess Cash Flow 151 What to Do with Excess Cash? 152 Summary 154 Appendix 7A: Marriott Corporation Income Statements and Balance Sheets 156 Appendix 7B: Marriott Corporation Selected Ratios 158 Chapter 8 Investment Decisions (Marriott Corporation and Gary Wilson) 159 What Is the Correct Price? 160 How Should Marriott Buy Its Shares? 160 The Loan Covenants 164 The Impact of the Product Market on Financial Policies 165 The Capital Market Impact and the Future 167 Summary 173 Chapter 9 Financial Policy Decisions (AT&T: Before and After the 1984 Divestiture) 177 Background on AT&T 178 M&M and the Practice of Corporate Finance 178 Old (pre-1984) AT&T 180 New (post-1984) AT&T 195 Summary 207 Appendix 9A: Development of AT&T Pro Formas, 1984–1988 (Expected-Case) 208 Chapter 10 The Impact of Operating Strategy on Corporate Finance Policy (MCI) 211 A Brief Summary 211 A Brief History of MCI 213 Convertible Preferred Stock and Convertible Bonds 218 Interest Rates and Debt Ratios 222 Leases 223 Financing Needs of the New MCI 223 MCI’s Financing Choice 234 MCI Postscript 235 Summary 236 Appendix 10A: Development of MCI’s Pro Formas, 1984–1988 238 Chapter 11 Dividends and Stock Repurchases (Apple Inc.) 241 The Theory of Dividend Policy 241 Empirical Evidence 245 Apple Inc. and the Decision on Whether to Pay Dividends 248 What Did Apple Do about Dividends? 260 What Happened Next 261 Summary 264 Chapter 12 A Continuation of Capital Structure Theory 265 The Tax Shield of Debt 266 The Costs of Financial Distress 267 Transaction Costs, Asymmetric Information, and Agency Costs 269 Asymmetric Information and Firm Financing 272 Agency Costs: Manager Behavior and Capital Structure 279 Leverage and Agency Conflicts between Equity and Debt Holders 281 Start with the Amount of Financing Required 286 Summary 288 Chapter 13 Restructuring and Bankruptcy: When Things Go Wrong (Avaya Holdings) 291 When Things Go Wrong 291 The Key Economic Principle of Bankruptcy Is to Save Viable Firms 297 When Should a Firm File for Bankruptcy? 297 The Rules of Bankruptcy 300 Maintaining the Value of a Firm in Bankruptcy 303 Avaya Emerges from Bankruptcy 304 Summary 306 Appendix 13A: The Creditors Coordination Problem 308 Part Three Investments and Valuation Chapter 14 The Time Value of Money: Discounting and Net Present Values 311 The Time Value of Money 311 Net Present Value (NPV) 316 Payback 322 Projects with Unequal Lives 323 Perpetuities 325 Summary 326 Chapter 15 Valuation and Cash Flows (Sungreen A) 327 Investment Decisions 327 How to Value a Project 328 The Weighted Average Cost of Capital (WACC) 340 Terminal Values 341 Summary 343 Chapter 16 Valuation (Sungreen B) 345 Sungreen’s Projected Cash Flows 345 The Weighted Average Cost of Capital (WACC) 346 Twin Firms 351 The Cost of Equity 354 The Cost of Debt 357 The Final Valuation 358 Strategic Analysis 360 Summary 361 Chapter 17 Valuation Nuances 363 Cash Flow Nuances 363 Cost of Capital Nuances 365 Nuances on Calculating the Cost of Equity: Levering and Unlevering Beta 371 Separating Cash Flows and Terminal Values 376 Nuances of Terminal Value Methods 376 Other Valuation Techniques: DCF Variations 383 Real Options (aka Strategic Choices) 386 Summary 389 Chapter 18 Leveraged Buyouts and Private Equity Financing (Congoleum) 391 Congoleum: A Short History 391 Leading up to the LBO: What Makes a Firm a Good LBO Target? 392 Details of the Deal 395 Postscript: What Happened to LBOs? 409 Summary 411 The World Keeps Changing 412 Appendix 18A: Congoleum’s Pro Formas with and without the LBO 414 Appendix 18B: Highlights of the Lazard Fairness Opinion 420 Chapter 19 Mergers and Acquisitions: Strategic Issues (The Dollar Stores) 423 The Three Main Competitors 423 Recent History 424 Shopping a Firm/Finding a Buyer 428 Summary 431 Chapter 20 Valuing an Acquisition: Free Cash Flows to the Firm (The Dollar Stores) 433 The Bid for Family Dollar 433 Free Cash Flows to the Firm 435 Estimating the Cost of Capital 443 Discounted Cash Flows 448 Terminal Values 448 The Three Pieces 451 Summary 452 Appendix 20A: Family Dollar Pro Forma Financial Statements with Authors’ Constant Debt Ratio 453 Chapter 21 Understanding Free Cash Flows (The Dollar Stores) 455 Comparing the Free-Cash-Flows Formulas 455 Back to Discount Rates 457 On to Free Cash Flows to Equity 459 Discounting the Free Cash Flows to Equity 462 Summary 463 Appendix 21A: Family Dollar Pro Forma Free Cash Flows to Equity with Constant Debt Ratio 464 Chapter 22 Mergers and Acquisitions: Execution (The Dollar Stores) 465 The Time Line 465 Managerial Discretion 468 Activist Shareholders 470 The Federal Trade Commission (FTC) 472 Shareholder Lawsuits 473 The Vote 474 Summary 475 Appendix 22A: Key Events in the Bidding for Family Dollar, 2014–2015 476 Chapter 23 Review 477 Chapters 2–4: Cash Flow Management—Financial Tools 478 Chapters 5–13: Financing Decisions and Financial Policies 478 Chapters 14–22: Valuation 482 Tools and Concepts Discussed in This Book 485 Finance as Art, Not Science 486 Bottom Lines 487 An Intelligent Approach to Finance 487 Keeping Current 488 Larry’s Last (Really a True) Story 489 Paul’s Theory of Pies 490 Rules to Live By 490 Glossary 493 Index 503

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Book SynopsisHow to steer your business through times of financial distress and achieve sustained profitability Corporate Turnaround Artistry is a complete guide for entrepreneurial companies in times of financial distresspresenting effective strategies and proven methods to revive and rehabilitate your business. Uncertain economic times have significantly altered the financial resources available to struggling businesses. Narrowing margins and mounting internal and external pressure has taken their toll on many companies. Fortunately, most businesses can be repaired while maintaining their existing revenue structure. Offering practical steps that go beyond simple cost-cutting and sales-building advice, this invaluable guide teaches you how to control cash, secure financial relief, and develop a comprehensive turnaround plan that your employees, customers, and creditors will support. Business leaders and entrepreneurs often fall into the trap of assuming new debt whenTable of ContentsAbout the Author ix Foreword xi Professor Kenneth P. Walsleben Preface xv Acknowledgments xix Chapter 1 Understanding Corporate Turnarounds 1 Chapter 2 Crisis Leadership 45 Chapter 3 Controlling Cash 73 Chapter 4 When Banks Attack 103 Chapter 5 Turnaround Management 141 Chapter 6 Arsonists and Regulators 171 Chapter 7 Insolvency and the Law 189 Chapter 8 Debt Restructuring Out of Court 237 Chapter 9 Strategic Exits 261 Chapter 10 Building Long-Term Value 279 Resources 297 Bibliography 299 Index 301

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Book SynopsisAn incisive and essentialguide to building a complete system for derivative scripting InVolume 2 ofModern Computational Finance Scripting for Derivatives and xVA,quantitative finance expertsand practitioners Drs. Antoine Savine and Jesper Andreasen deliver an indispensable and insightfulroadmap to the interrogation, aggregation, and manipulation of cash-flows in a variety of ways. The book demonstrates how to facilitate portfolio-wide risk assessment andregulatory calculations (like xVA). Complete with a professional scripting library written in modern C++, this stand-alone volumewalks readers through the construction of a comprehensiverisk and valuationtool.Thisessentialbook also offers: Effective strategies for improving scripting libraries, from basic exampleslikesupport for dates and vectorsto advanced improvements, including American Monte Carlo techniques Exploration of the concepts of fuzzy logic and risk sensitivities,includiTrade Review“The Global Financial Crisis resulted in profound changes in quants’ Modus Operandi. This timely three-volume set describes some of the tools necessary to deal with these changes. Individual volumes cover in detail several important topics of interest to anyone who wants to stay au courant with modern developments in financial engineering. While the books are predominantly practically oriented, they strike a fine balance between theoretical and applied considerations. The authors are prominent practitioners and indisputable thought-leaders in the field. I recommend this set enthusiastically to anyone who wishes to understand the current and emerging trends in financial engineering.” - Prof. Alexander Lipton, Founder and CEO, Stronghold Labs; Fellow, Connection Science and Engineering, Massachusetts Institute of Technology Table of ContentsMy Life in Script by Jesper Andreasen xi Part I A Scripting Library in C++ Introduction 3 Chapter 1 Opening Remarks 7 Introduction 7 1.1 Scripting is not only for exotics 12 1.2 Scripting is for cash-flows not payoffs 13 1.3 Simulation models 15 1.4 Pre-processing 17 1.5 Visitors 19 1.6 Modern implementation in C++ 21 1.7 Script templates 22 Chapter 2 Expression Trees 25 2.1 In theory 25 2.2 In code 35 Chapter 3 Visitors 41 3.1 The visitor pattern 41 3.2 The debugger visitor 47 3.3 The variable indexer 50 3.4 Pre-processors 54 3.5 Const visitors 55 3.6 The evaluator 57 3.7 Communicating with models 65 Chapter 4 Putting Scripting Together with a Model 71 4.1 A simplistic Black-Scholes Monte-Carlo simulator 71 4.1.1 Random number generators 71 4.1.2 Simulation models 73 4.1.3 Simulation engines 76 4.2 Connecting the model to the scripting framework 76 Chapter 5 Core Extensions and the “Pays” Keyword 81 5.1 In theory 81 5.2 In code 83 Part II Basic Improvements Introduction 93 Chapter 6 Past Evaluator 95 Chapter 7 Macros 97 Chapter 8 Schedules of Cash-Flows 99 Chapter 9 Support for Dates 105 Chapter 10 Predefined Schedules and Functions 109 Chapter 11 Support for Vectors 113 11.1 Basic functionality 113 11.2 Advanced functionality 115 11.2.1 New node types 116 11.2.2 Support in the parser 116 11.2.3 Processing 117 11.2.4 Evaluation 117 Part III Advanced Improvements Introduction 121 Chapter 12 Linear Products 123 12.1 Interest rates and swaps 123 12.2 Equities, foreign exchange, and commodities 125 12.3 Linear model implementation 126 Chapter 13 Fixed Income Instruments 127 13.1 Delayed payments 127 13.2 Discount factors 128 13.3 The simulated data processor 129 13.4 Indexing 129 13.5 Upgrading “pays” to support delayed payments 131 13.6 Annuities 132 13.7 Forward discount factors 132 13.8 Back to equities 132 13.9 Libor and rate fixings 133 13.10 Scripts for swaps and options 134 Chapter 14 Multiple Underlying Assets 137 14.1 Multiple assets 137 14.2 Multiple currencies 139 Chapter 15 American Monte-Carlo 143 15.1 Least Squares Method 143 15.2 One proxy 147 15.3 Additional regression variables 149 15.4 Feedback and exercise 149 15.5 Multiple exercise and recursion 152 Part IV Fuzzy Logic and Risk Sensitivities Introduction 157 Chapter 16 Risk Sensitivities with Monte-Carlo 161 16.1 Risk instabilities 161 16.2 Two approaches toward a solution 165 16.3 Smoothing for digitals and barriers 166 16.4 Smoothing for scripted transactions 168 Chapter 17 Support for Smoothing 169 Chapter 18 An Automated Smoothing Algorithm 175 18.1 Basic algorithm 176 18.2 Nested and combined conditions 179 18.3 Affected variables 179 18.4 Further optimization 180 Chapter 19 Fuzzy Logic 183 Chapter 20 Condition Domains 189 20.1 Fuzzy evaluation of discrete conditions 189 20.1.1 Condition domains 189 20.1.2 Constant conditions 190 20.1.3 Boolean conditions 191 20.1.4 Binary conditions 193 20.1.5 Discrete conditions 193 20.1.6 Putting it all together 197 20.2 Identification of condition domains 198 20.3 Constant expressions 201 Chapter 21 Limitations 203 21.1 Dead and alive 203 21.2 Non-linear use of fuzzy variables 206 Chapter 22 The Smoothing Factor 209 22.1 Scripting support 209 22.2 Automatic determination 211 Part V Application to xVA Chapter 23 xVA 215 Chapter 24 Branching 219 Chapter 25 Closing Remarks 223 25.1 Script examples 223 25.2 Multi-threading and AAD 228 25.3 Advanced LSM optimizations 229 Appendix A Parsing 231 A.1 Preparing for parsing 231 A.2 Parsing statements 234 A.3 Recursively parsing conditions 238 A.4 Recursively parsing expressions 244 A.5 Performance 252 Bibliography 255 Index 257

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Book SynopsisIn the newly revised second edition of Venture Capital, Private Equity, and the Financing of Entrepreneurship, a dedicated team of researchers and professionals delivers an authoritative and comprehensive account of the world of active investing. This important work demonstrates how venture capitalists and private equity investors do business and create value for entrepreneurs, shareholders, and other stakeholders. The authors, drawing on decades of combined experience studying and participating in the private equity markets, discuss the players, dynamics, and the incentives that drive the industry. They also describe various possibilities for the future development of private equity. This latest edition is perfect for advanced undergraduate students of finance and business, as well as MBA students seeking an insightful and accessible textbook describing the private equity markets.Table of ContentsPreface vii Acknowledgments ix About the Authors xi 1. Introduction 1 2. The Private Equity Cycle— Fundraising and Fund Choosing 20 3. Deal Sourcing and Evaluation— Not as Easy as It Looks! 65 4. Assigning Value 101 5. Deal Structuring— Private Equity Securities and Their Motivation 131 6. After the Money Arrives 175 7. Getting Liquid: Exits and Distributions 204 8. The Globalization of Venture Capital and Private Equity 246 9. Risk and Return 285 10. The Impact of Private Equity on Society— Does This Really Matter Anyway? 313 11. People, Positions, and Culture: The Management of the Private Equity Firm 345 12. Scaling and Institutionalization 374 13. Boom and Bust 404 14. Wrapping Up 435 Glossary G- 1 Index I- 1

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Book SynopsisDetect accounting fraud before it's too late Accounting fraud is the deliberate manipulation of accounting records in order to make a company''s financial performance seem better or worse than it actually is. Accounting scandals often have catastrophic consequences for shareholders and employees. Thus, analysts and auditors must be equipped to detect accounting fraud. This book is a comprehensive guide to detecting accounting fraud for auditors investigating accounting fraud and analysts/managers seeking to prevent it. A wide variety of warning signs are described, as are several techniques for detecting and addressing fraud. Understand the motivations and warning signs behind accounting fraud Get to know how accounting fraud is done and how to detect it Avoid the losses that often come from accounting fraud Benefit from case studies throughout to that help illustrate the author''s points It's unfortunate thaTable of ContentsPrologue xi Introduction xiii Chapter 1 Fraud and Accounting Manipulations 1 1.1 Fraud and Its Effects 1 1.2 Modifying Companies’ Financial Information 2 1.3 Calling Things by Their Name: From Creative Accounting to Big Baths 4 Chapter 2 Accounting Fraud: An Ancient Practice 9 2.1 The First Accounting Frauds 9 2.2 Accounting Frauds Continue with the Double Entry 10 2.3 The Crash of 1929 and the Obligation to Audit Accounts 12 2.4 Reinforcement of the Commercial Law and Auditing After the String of Scandals of 2000 13 2.5 With the Crisis of 2008, History Repeats Itself 15 Chapter 3 Problems with Legislation and Those Involved in the Financial Information 19 3.1 How Financial Information Is Generated 19 3.2 Auditing of Accounts: Essential, but Not Infallible 20 3.3 Analysts and Rating Agencies 23 3.4 Regulators and the Limitations of Accounting Regulations 26 3.5 Role of the Media 29 Chapter 4 Why Are Accounts Manipulated? 31 4.1 Motivation, Opportunity, and Rationalization 31 4.2 The Door to Fraud 34 Chapter 5 Legal Accounting Manipulations 47 5.1 Alternatives, Estimations, and Legal Gaps 47 5.2 Main Legal Manipulations 52 5.3 Impact of Legal Manipulations in the Accounts 58 Chapter 6 Illegal Accounting Manipulations 61 6.1 Accounting Crime 61 6.2 How Illegal Manipulations Are Done 63 6.3 Operations Through Tax Havens 65 6.4 Main Illegal Manipulations 68 6.5 Main Items Affected by Accounting Frauds 70 Chapter 7 Ethical Considerations and Economic Consequences of Manipulations 75 7.1 The Ethical Dimensions of Accounting Fraud 75 7.2 Economic Consequences of Accounting Fraud 77 7.3 Consequences to Managers and Companies that Manipulate Accounts 77 7.4 What to Do When a Company Deteriorates 79 Chapter 8 Personal Warning Signs 85 8.1 Moments the Warning Signs Occur 85 8.2 Warning Signs Before Fraud Occurs 87 8.3 Warning Signs After the Fraud Occurs 89 8.4 Language of Fraudsters 91 8.5 Successful Businessmen Who End Up in Jail 93 Chapter 9 Organizational Warning Signs and Nonfinancial Indicators 99 9.1 Warning Signs Before a Fraud Occurs 99 9.2 Warning Signs After a Fraud Occurs 106 9.3 Warning Signs Based on Nonfinancial Indicators 107 Chapter 10 Warning Signs in the Accounts 111 10.1 Auditing of Accounts 111 10.2 Balance Sheet 112 10.3 Income Statement 113 10.4 Cash Flow Statement 115 10.5 Statement of Changes in Equity 119 10.6 Notes 120 10.7 Ratios That Anticipate Frauds 121 10.8 Variations in Accounts that Warn of Frauds Already Produced 123 10.9 Ratios That Warn of Frauds Already Produced 124 10.10 Synthetic Index to Detect Manipulating Companies 133 Chapter 11 Some Suggestions to Improve the Current Situation 141 11.1 Reinforce Values and Institute Ethical Codes 141 11.2 Improve Control Systems in Organizations 143 11.3 Improve Regulation 147 11.4 Reinforce Supervision 148 11.5 Reinforce the Sanctioning Regime 149 11.6 The Challenge of Providing Relevant Information for Decision-Making 150 Epilogue 155 Appendix 1 Criminal Responsibility of Legal Entities and Regulatory Compliance 157 Appendix 2 Audit Program for the Identification of Fraud Risks 161 List of Companies Mentioned in the Book and Section in which They Appear 179 Index 183

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Book SynopsisTable of Contents1 Managerial Accounting in the Information Age 1-1 Goal of Managerial Accounting 1-2 Cost Terms Used in Discussing Planning, Control, and Decision Making 1-7 Two Key Ideas in Managerial Accounting 1-10 The Information Age and Managerial Accounting 1-13 Ethical Considerations in Managerial Decision Making 1-17 The Controller as the Top Management Accountant 1-20 Chapter Review: Summary of Learning Objectives / Review Problems / Key Terms / Self-Assessment 1-22 End-of-Chapter Homework: Questions / Exercises / Problems / Cases 1-25 Appendix: IMA Statement of Ethical Professional Practice 1-32 2 Job-Order Costing for Manufacturing and Service Companies 2-1 Cost Classifications for Manufacturing Firms 2-2 Product Cost Information in Financial Reporting and Decision Making 2-6 Balance Sheet Presentation of Product Costs 2-7 Flow of Product Costs in Accounts 2-8 Income Statement Presentation of Product Costs 2-8 Types of Costing Systems 2-11 Overview of Job Costs and Financial Statement Accounts 2-11 Job-Order Costing System 2-13 Eastlake Revisited: Using Job Cost Information 2-18 Relation Between the Costs of Jobs and the Flow of Costs in Work in Process, Finished Goods, and Cost of Goods Sold 2-19 Allocating Overhead to Jobs: A Closer Look 2-20 Predetermined Overhead Rates 2-21 Job-Order Costing for Service Companies 2-24 Modern Manufacturing Practices and Product Costing Systems 2-27 Chapter Review: Summary of Learning Objectives / Review Problems / Key Terms / Self-Assessment 2-30 End-of-Chapter Homework: Questions / Exercises / Problems / Cases 2-35 3 Process Costing 3-1 Difference between Job-Order and Process Costing Systems 3-2 Product and Cost Flows 3-3 Calculating Unit Cost 3-6 Calculating and Applying Cost per Equivalent Unit: Mixing Department Example 3-7 Production Cost Report 3-9 Basic Steps in Process Costing: A Summary 3-11 Kent Chemical Revisited: Answering Stacy’s Question 3-12 Dealing with Transferred-in Cost: Packaging Department Example 3-12 Process Costing and Incremental Analysis 3-14 “You Get What You Measure!” and Manufacturing Processes 3-15 Chapter Review: Summary of Learning Objectives / Review Problems / Key Terms / Self-Assessment 3-16 End-of-Chapter Homework: Questions / Exercises / Problems / Cases 3-20 4 Cost-Volume-Profit Analysis 4-1 Common Cost Behavior Patterns 4-2 Cost Estimation Methods 4-6 Cost-Volume-Profit Analysis 4-14 Multiproduct Analysis 4-19 Assumptions in CVP Analysis 4-23 Codeconnect Example Revisited: Answering Mary’s Questions 4-23 Operating Leverage 4-24 Constraints 4-25 Chapter Review: Summary of Learning Objectives / Review Problems / Key Terms / Self-Assessment 4-26 End-of-chapter Homework: Questions / Exercises / Problems / Cases 4-30 Appendix: Using Regression in Microsoft Excel to Estimate Fixed and Variable Costs 4-46 5 Variable Costing 5-1 Full (Absorption) and Variable Costing 5-2 Effects of Production on Income for Full Versus Variable Costing: The Clausentube Example 5-5 Benefits of Variable Costing for Internal Reporting 5-12 Variable Costing Limits Management of Earnings via Production Volume 5-12 Chapter Review: Summary of Learning Objectives / Review Problems / Key Terms / Self-Assessment 5-13 End-of-Chapter Homework: Questions / Exercises / Problems / Cases 5-17 6 Cost Allocation and Activity-Based Costing 6-1 Purposes of Cost Allocation 6-2 Process of Cost Allocation 6-5 Allocating Service Department Costs 6-8 Problems with Cost Allocation 6-10 Activity-Based Costing 6-14 Activity-Based Management 6-23 Remember—You Get What You Measure! 6-24 Chapter Review: Summary of Learning Objectives / Review Problems / Key Terms / Self-Assessment 6-25 End-of-Chapter Homework: Questions / Exercises / Problems / Cases 6-29 Appendix: Activity-Based Management 6-46 7 The Use of Cost Information in Management Decision Making 7-1 Incremental Analysis 7-2 Analysis of Decisions Faced by Managers 7-5 Decisions Involving Joint Costs 7-14 Qualitative Considerations in Decision Analysis 7-17 Chapter Review: Summary of Learning Objectives / Review Problems / Key Terms / Self-Assessment 7-18 End-of-Chapter Homework: Questions / Exercises / Problems / Cases 7-21 Appendix: The Theory of Constraints 7-34 8 Pricing Decisions, Customer Profitability Analysis, and Activity-Based Pricing 8-1 The Profit-Maximizing Price 8-2 Pricing Special Orders 8-4 Cost-Plus Pricing 8-5 Target Costing 8-7 Analyzing Customer Profitability: Revisiting the Priced Right Office Supplies Case 8-8 Customer Profitability and Performance Measures 8-11 Activity-Based Pricing 8-11 Chapter Review: Summary of Learning Objectives / Review Problems / Key Terms / Self-Assessment 8-12 End-of-Chapter Homework: Questions / Exercises / Problems / Cases 8-19 9 Capital Budgeting and Other Long-Run Decisions 9-1 Capital Budgeting Decisions 9-2 Evaluating Investment Opportunities: Time Value of Money Approaches 9-3 Considering “Soft” Benefits in Investment Decisions 9-11 Estimating the Required Rate of Return 9-13 Additional Cash Flow Considerations 9-14 Other Long-Run Decisions 9-17 Simplified Approaches to Capital Budgeting 9-18 Conflict between Performance Evaluation and Capital Budgeting 9-21 Wilson Air Example Revisited 9-23 Chapter Review: Summary of Learning Objectives / Review Problems / Key Terms / Self-Assessment 9-24 End-of-Chapter Homework: Questions / Exercises / Problems / Cases 9-27 Appendix A: Using Microsoft Excel to Calculate NPV and IRR 9-36 Appendix B 9-39 10 Budgetary Planning and Control 10-1 Use of Budgets in Planning and Control 10-2 Developing the Budget 10-4 The Master Budget 10-5 Use of Computers in the Budget Planning Process 10-14 Budgetary Control 10-14 Investigating Budget Variances 10-17 Conflict in Planning and Control Uses of Budgets 10-18 Evaluation, Measurement, and Management Behavior 10-19 The Preston Joystick Case Revisited 10-20 Chapter Review: Summary of Learning Objectives / Review Problems / Key Terms / Self-Assessment 10-20 End-of-Chapter Homework: Questions / Exercises / Problems / Cases 10-26 11 Standard Costs and Variance Analysis 11-1 Standard Costs 11-2 A General Approach to Variance Analysis 11-5 Material Variances 11-5 Direct Labor Variances 11-7 Overhead Variances 11-8 Test Your Knowledge: Comprehensive Example 11-13 Investigation of Standard Cost Variances 11-16 Responsibility Accounting and Variances 11-19 Chapter Review: Summary of Learning Objectives / Review Problems / Key Terms / Self- Assessment 11-19 End-of-Chapter Homework: Questions / Exercises / Problems / Cases 11-23 Appendix: Recording Standard Costs in Accounts 11-33 12 Decentralization and Performance Evaluation 12-1 Why Firms Decentralize 12-2 Why Companies Evaluate the Performance of Subunits and Subunit Managers 12-4 Cost Centers, Profit Centers, and Investment Centers 12-6 Evaluating Investment Centers with ROI 12-8 Evaluation Using Economic Value Added (EVA) 12-13 Using a Balanced Scorecard to Evaluate Performance 12-18 Developing a Strategy Map for a Balanced Scorecard 12-21 Keys to a Successful Balanced Scorecard: Targets, Initiatives, Responsibility, Funding, Top Management Support 12-22 Chapter Review: Summary of Learning Objectives / Review Problems / Key Terms / Self-Assessment 12-23 End-of-chapter Homework: Questions / Exercises / Problems / Cases 12-28 Appendix: Transfer Pricing 12-39 Glossary G- 1 Index I- 1 Chapters 13 & 14 Available in WileyPLUS 13 Statement of Cash Flows 13-1 Need for a Statement of Cash Flows 13-2 Types of Business Activities and the Classification of Cash Flows 13-2 The Statement of Cash Flows Prepared Using the Direct Method 13-5 Preparing the Statement of Cash Flows Using the Indirect Method 13-9 Interpreting Information in the Statement of Cash Flows: The Situation at Ravira Restaurant Supply 13-13 Chapter Review: Summary of Learning Objectives / Review Problems / Key Terms / Self-Assessment 13-14 End-of-Chapter Homework: Questions / Exercises / Problems / Case 13-18 14 Analyzing Financial Statements: A Managerial Perspective 14-1 Why Managers Analyze Financial Statements 14-2 Horizontal and Vertical Analyses 14-4 Earnings Management and the Need to Compare Earnings and Cash-Flow Information 14-7 Other Sources of Information on Financial Performance 14-9 Ratio Analysis 14-10 A Managerial Perspective on the Analysis of HGW’S Financial Statements 14-14 Summary of Analyses 14-16 Chapter Review: Summary of Learning Objectives / Review Problems / Key Terms / Self-Assessment 14-17 End-of-chapter Homework: Questions / Exercises / Problems / Cases 14-21

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Book SynopsisAn updated review of the theories and applications of corporate risk management After the financial crisis of 2008, issues concerning corporate risk management arose that demand new levels of oversight. Corporate Risk Management is an important guide to the topic that puts the focus on the corporate finance dimension of risk management. The authora noted expert on the topicpresents several theoretical models appropriate for various industries and empirically verifies theoretical propositions. The book also proposes statistical modeling that can evaluate the importance of different risks and their variations according to economic cycles. The book provides an analysis of default, liquidity, and operational risks as well as the failures of LTCM, ENRON, and financial institutions that occurred during the financial crisis. The author also explores Conditional Value at Risk (CVaR), which is central to the debate on the measurement of market risk under Basel IIITable of ContentsForeword by Denis Kessler xiii Introduction xvii General Presentation xvii Contents of the Book xix Acknowledgments xx General References xxi Chapter 1 Risk Management: Definition and Historical Development 1 1.1 History of Risk Management 2 1.2 Milestones in Financial Risk Management 3 1.3 Current Definition of Corporate Risk Management 7 1.4 Conclusion 8 References 9 Chapter 2 Theoretical Determinants of Risk Management in Non-Financial Firms 11 2.1 Value of Risk Management 12 2.2 Comparative Advantages in Risk Taking 16 2.3 Risk Management and Capital Structure 17 2.4 Risk Management and Managerial Incentives 18 2.5 Conclusion 19 References 19 Chapter 3 Risk Management and Investment Financing 21 3.1 Basic Model 21 3.2 Illustration with the Standard Debt Contract 27 3.3 Model with Two Random Variables 28 3.4 Conclusion 31 References 31 Appendix A: Value of dI*/dw 31 Appendix B: Standard Debt Dcontract 32 Chapter 4 Significant Determinants of Risk Management of Non-Financial Firms 35 4.1 Rationale for the Research 35 4.2 Significant Determinants 36 4.3 Governance and Endogeneity of Debt 50 4.4 Conclusion 60 References 61 Appendix: Construction of the Tax-Save Variable 62 Chapter 5 Value at Risk 63 5.1 Example of VaR 63 5.2 Numerical Method 65 5.3 Parametric Method 66 5.4 Taking Time Periods into Consideration 67 5.5 Confidence Interval of the VaR 68 5.6 CVaR 69 5.7 Conclusion 70 References 71 Chapter 6 Choice of Portfolio and VaR Constraint 73 6.1 Optimal Benchmark Portfolio of the Firm 73 6.2 Optimal Portfolio of a Constrained Manager 75 6.3 Conclusion 77 References 77 Chapter 7 VaR in Portfolios of Assets and Options 79 7.1 VaR as a Risk Measure 79 7.2 Models without Derivatives 80 7.3 VaR with Options 85 7.4 Black and Scholes Model and Risk Management 88 7.5 Delta-Gamma VaR 90 7.6 VaR of a General Portfolio 90 7.7 Application 92 7.8 Conclusion 97 References 97 Chapter 8 Conditional VaR 99 8.1 Motivation for CVaR and Coherence in Risk Measures 99 8.2 Notation and VaR 101 8.3 Definition of CVaR 104 8.4 Another Way to Derive CVaR with a Return Distribution 107 8.5 Example with Student’s t-Distribution and Other Examples 108 8.6 Conclusion: CVaR in Basel Regulation 111 References 111 Chapter 9 Regulation of Bank Risk and Use of VaR 113 9.1 Basel Accords 114 9.2 Market Risk Regulation of 1996 120 9.3 Specific Risks 120 9.4 Total Required Capital 122 9.5 Tests 124 9.6 Comparison between Standard and Internal Methods with Interest Rate Risk 124 9.7 Conclusion 133 References 134 Chapter 10 Optimal Financial Contracts and Incentives under Moral Hazard 135 10.1 Optimal Financial Contracts and Moral Hazard 136 10.2 Theoretical Model 140 10.3 Empirical Application to Air Accident Risk 144 10.4 Conclusion 148 References 148 Appendix A: Synthesis of Forms of Financial Contracts 149 Appendix B: Definitions of Variables 150 Chapter 11 Venture Capital Risk with Optimal Financing Structure 153 11.1 Some Statistics about Venture Capital 154 11.2 Role of Venture Capital Firms 155 11.3 Venture Capital Firms and Added Value 156 11.4 Role of Convertible Debt 156 11.5 Information Asymmetry and Venture Capital 158 11.6 Conclusion 163 References 164 Chapter 12 Bank Credit Risk: Scoring of Individual Risks 167 12.1 Theoretical Model 169 12.2 Empirical Analysis 171 12.3 Credit Line and Loan Default 180 12.4 Conclusion 182 References 182 Chapter 13 Portfolio Management of Credit Risk 185 13.1 CreditMetrics 185 13.2 Review of Chapters 2 and 3 of CreditMetrics 186 13.3 KMV Approach 193 13.4 Calculation of Correlations 196 13.5 Conclusion 202 References 202 Chapter 14 Quantification of Banks’ Operational Risk 205 14.1 Context and Presentation of Operational Risk 205 14.2 Measurement of Regulatory Capital 208 14.3 Calculation of Regulatory Capital for Losses of over $1 Million (LDA) 210 14.4 Conclusion 227 References 228 Chapter 15 Liquidity Risk 231 15.1 Theoretical Modeling of CDSs 232 15.2 Bond Yield Spread’s Default Portion 233 15.3 Empirical Measurement of Yield Spreads’ Default Portion 235 15.4 Non-Default Portion of Yield Spreads 237 15.5 Illiquidity Index 242 15.6 Illiquidity Premium 244 15.7 Data 244 15.8 Principal Component Analysis of Liquidity Risk 245 15.9 Empirical Analysis of Credit Cycles 246 15.10 Regime Detection Model 248 15.11 Detection of Default and Liquidity Regimes 250 15.12 Conclusion 251 References 252 Chapter 16 Long-Term Capital Management 255 16.1 Brief History of the Fund 256 16.2 Risk Management, VaR, and Required Capital 258 16.3 Portfolio Optimization and Leverage Effect 260 16.4 Conclusion 261 References 262 Chapter 17 Structured Finance and the Financial Crisis of 2007–2009 263 17.1 Structured Finance 263 17.2 Poor Risk Management Linked to the Structured Finance Market 264 17.3 Conclusion 266 References 268 Appendix: How to Create an AAA CDO Tranche from BBB Loans 269 Chapter 18 Risk Management and Corporate Governance 271 18.1 Enron and Corporate Governance 271 18.2 Financial Crisis and Corporate Governance 273 18.3 New 2002 Governance Rules 273 18.4 Risk Management and Governance 274 18.5 Administrative Competence of Board Members 276 18.6 New Regulation for Financial Institutions 276 18.7 Economic Analysis of Governance Effect 277 18.8 Conclusion 288 References 288 Appendix A: Governance of Canadian Federal Financial Institutions 290 Appendix B: Details on the Construction of the Governance Indexes 291 Appendix C: Variables 293 Chapter 19 Risk Management and Industrial Organization 295 19.1 Entry, Production, and Hedging 295 19.2 Commitment to Hedging 297 19.3 Conclusion 297 References 299 Chapter 20 Real Implications of Corporate Risk Management 301 20.1 Real Implications of Corporate Risk Management: A Review 302 20.2 Methodology 303 20.3 US Oil Producers 309 20.4 Multivariate Results 316 20.5 Conclusion 324 References 324 Appendix: Estimated MTEs 326 Chapter 21 Exercises 331 Exercise 1 Portfolio Choice and the Notion of Value at Risk (VaR) 331 Exercise 2 Backtesting of VaR Models 345 Exercise 3 Calculation of VaR with Different Distributions and Accuracy of VaR 351 Exercise 4 VaR for an Equity Portfolio with Options 359 Exercise 5 CVaR Conditional Value at Risk 369 Conclusion 376 Reference 376 Conclusion 377 General References 378 Index 379

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Book SynopsisTable of ContentsPreface xiii Acknowledgments xv About the CFA Investment Series xvii Chapter 1 Overview of Equity Securities 1 Learning Outcomes 1 1. Introduction 1 2. Equity Securities in Global Financial Markets 2 3. Types and Characteristics of Equity Securities 8 3.1. Common Shares 9 3.2. Preference Shares 11 4. Private versus Public Equity Securities 13 5. Investing in Non-Domestic Equity Securities 15 5.1. Direct Investing 17 5.2. Depository Receipts 17 6. Risk and Return Characteristics of Equity Securities 21 6.1. Return Characteristics of Equity Securities 21 6.2. Risk of Equity Securities 22 7. Equity Securities and Company Value 23 7.1. Accounting Return on Equity 24 7.2. The Cost of Equity and Investors’ Required Rates of Return 28 8. Summary 29 References 31 Practice Problems 31 Chapter 2 Introduction to Industry and Company Analysis 35 Learning Outcomes 35 1. Introduction 36 2. Uses of Industry Analysis 36 3. Approaches to Identifying Similar Companies 37 3.1. Products and/or Services Supplied 37 3.2. Business-Cycle Sensitivities 38 3.3. Statistical Similarities 39 4. Industry Classification Systems 40 4.1. Commercial Industry Classification Systems 40 4.2. Governmental Industry Classification Systems 44 4.3. Strengths and Weaknesses of Current Systems 45 4.4. Constructing a Peer Group 46 5. Describing and Analyzing an Industry 50 5.1. Principles of Strategic Analysis 52 5.2. External Influences on Industry Growth, Profitability, and Risk 70 6. Company Analysis 77 6.1. Elements That Should Be Covered in a Company Analysis 77 6.2. Spreadsheet Modeling 80 7. Summary 81 References 84 Practice Problems 84 Chapter 3 Equity Valuation: Concepts and Basic Tools 89 Learning Outcomes 89 1. Introduction 90 2. Estimated Value and Market Price 90 3. Major Categories of Equity Valuation Models 92 4. Present Value Models: The Dividend Discount Model 94 4.1. Dividends: Background for the Dividend Discount Model 94 4.2. The Dividend Discount Model: Description 96 4.3. Preferred Stock Valuation 100 4.4. The Gordon Growth Model 103 4.5. Multistage Dividend Discount Models 108 5. Multiplier Models 112 5.1. Relationships among Price Multiples, Present Value Models, and Fundamentals 112 5.2. The Method of Comparables 116 5.3. Illustration of a Valuation Based on Price Multiples 119 5.4. Enterprise Value 121 6. Asset-Based Valuation 123 7. Summary 127 References 129 Practice Problems 129 Chapter 4 Equity Valuation: Applications and Processes 135 Learning Outcomes 135 1. Introduction 135 2. Value Definitions and Valuation Applications 136 2.1. What is Value? 136 2.2. Applications of Equity Valuation 139 3. The Valuation Process 141 3.1. Understanding the Business 142 3.2. Forecasting Company Performance 152 3.3. Selecting the Appropriate Valuation Model 153 3.4. Converting Forecasts to a Valuation 160 3.5. Applying the Valuation Conclusion: The Analyst’s Role and Responsibilities 161 4. Communicating Valuation Results 163 4.1. Contents of a Research Report 163 4.2. Format of a Research Report 165 4.3. Research Reporting Responsibilities 166 5. Summary 168 References 169 Practice Problems 170 Chapter 5 Return Concepts 177 Learning Outcomes 177 1. Introduction 177 2. Return Concepts 178 2.1. Holding Period Return 178 2.2. Realized and Expected (Holding Period) Returns 179 2.3. Required Return 179 2.4. Expected Return Estimates from Intrinsic Value Estimates 181 2.5. Discount Rate 183 2.6. Internal Rate of Return 183 3. The Equity Risk Premium 184 3.1. Historical Estimates 186 3.2. Forward-Looking Estimates 194 4. The Required Return on Equity 198 4.1. The Capital Asset Pricing Model 198 4.2. Multifactor Models 206 4.3. Build-Up Method Estimates of the Required Return on Equity 213 4.4. The Required Return on Equity: International Issues 217 5. The Weighted Average Cost of Capital 218 6. Discount Rate Selection in Relation to Cash Flows 220 7. Summary 220 References 222 Practice Problems 223 Chapter 6 Industry and Company Analysis 229 Learning Outcomes 229 1. Introduction 230 2. Financial Modeling: An Overview 230 2.1. Income Statement Modeling: Revenue 230 2.2. Income Statement Modeling: Operating Costs 236 2.3. Income Statement Modeling: Non-operating Costs 249 2.4. Income Statement Modeling: Other Items 253 2.5. Balance Sheet and Cash Flow Statement Modeling 254 2.6. Scenario Analysis and Sensitivity Analysis 256 3. The Impact of Competitive Factors on Prices and Costs 258 4. Inflation and Deflation 266 4.1. Sales Projections with Inflation and Deflation 267 4.2. Cost Projections with Inflation and Deflation 272 5. Technological Developments 274 6. Long-Term Forecasting 285 Case Study: Estimating Normalized Revenue 286 7. Building a Model 291 7.1. Industry Overview 291 7.2. Company Overview 292 7.3. Construction of Pro Forma Income Statement 293 7.4. Construction of Pro Forma Cash Flow Statement and Balance Sheet 299 7.5. Valuation Inputs 304 8. Summary 305 References 306 Practice Problems 306 Chapter 7 Discounted Dividend Valuation 313 Learning Outcomes 313 1. Introduction 314 2. Present Value Models 315 2.1. Valuation Based on the Present Value of Future Cash Flows 315 2.2. Streams of Expected Cash Flows 317 3. The Dividend Discount Model 322 3.1. The Expression for a Single Holding Period 323 3.2. The Expression for Multiple Holding Periods 324 4. The Gordon Growth Model 326 4.1. The Gordon Growth Model Equation 326 4.2. The Links Among Dividend Growth, Earnings Growth, and Value Appreciation in the Gordon Growth Model 334 4.3. Share Repurchases 334 4.4. The Implied Dividend Growth Rate 335 4.5. The Present Value of Growth Opportunities 336 4.6. Gordon Growth Model and the Price-to-Earnings Ratio 339 4.7. Estimating a Required Return Using the Gordon Growth Model 341 4.8. The Gordon Growth Model: Concluding Remarks 342 5. Multistage Dividend Discount Models 342 5.1. Two-Stage Dividend Discount Model 343 5.2. Valuing a Non-Dividend-Paying Company 346 5.3. The H-Model 347 5.4. Three-Stage Dividend Discount Models 349 5.5. Spreadsheet (General) Modeling 354 5.6. Estimating a Required Return Using Any DDM 356 5.7. Multistage DDM: Concluding Remarks 357 6. The Financial Determinants of Growth Rates 358 6.1. Sustainable Growth Rate 358 6.2. Dividend Growth Rate, Retention Rate, and ROE Analysis 360 6.3. Financial Models and Dividends 363 7. Summary 365 References 367 Practice Problems 368 Chapter 8 Free Cash Flow Valuation 383 Learning Outcomes 383 1. Introduction to Free Cash Flows 384 2. FCFF and FCFE Valuation Approaches 385 2.1. Defining Free Cash Flow 385 2.2. Present Value of Free Cash Flow 386 2.3. Single-Stage (Constant-Growth) FCFF and FCFE Models 387 3. Forecasting Free Cash Flow 389 3.1. Computing FCFF from Net Income 389 3.2. Computing FCFF from the Statement of Cash Flows 393 3.3. Noncash Charges 394 3.4. Computing FCFE from FCFF 400 3.5. Finding FCFF and FCFE from EBIT or EBITDA 405 3.6. FCFF and FCFE on a Uses-of-Free-Cash-Flow Basis 407 3.7. Forecasting FCFF and FCFE 409 3.8. Other Issues in Free Cash Flow Analysis 414 4. Free Cash Flow Model Variations 419 4.1. An International Application of the Single-Stage Model 420 4.2. Sensitivity Analysis of FCFF and FCFE Valuations 421 4.3. Two-Stage Free Cash Flow Models 422 4.4. Three-Stage Growth Models 430 4.5. ESG Considerations in Free Cash Flow Models 431 5. Nonoperating Assets and Firm Value 436 6. Summary 436 References 438 Practice Problems 438 Chapter 9 Market-Based Valuation: Price and Enterprise Value Multiples 455 Learning Outcomes 455 1. Introduction 456 2. Price and Enterprise Value Multiples in Valuation 457 2.1. The Method of Comparables 457 2.2. The Method Based on Forecasted Fundamentals 459 3. Price Multiples 460 3.1. Price to Earnings 460 3.2. Price to Book Value 492 3.3. Price to Sales 503 3.4. Price to Cash Flow 510 3.5. Price to Dividends and Dividend Yield 515 4. Enterprise Value Multiples 518 4.1. Enterprise Value to EBITDA 519 4.2. Other Enterprise Value Multiples 524 4.3. Enterprise Value to Sales 525 4.4. Price and Enterprise Value Multiples in a Comparable Analysis: Some Illustrative Data 526 5. International Considerations When Using Multiples 528 6. Momentum Valuation Indicators 529 7. Valuation Indicators: Issues in Practice 535 7.1. Averaging Multiples: The Harmonic Mean 535 7.2. Using Multiple Valuation Indicators 537 8. Summary 542 References 544 Practice Problems 546 Chapter 10 Residual Income Valuation 559 Learning Outcomes 559 1. Introduction 560 2. Residual Income 560 2.1. The Use of Residual Income in Equity Valuation 563 2.2. Commercial Implementations 564 3. The Residual Income Model 565 3.1. The General Residual Income Model 568 3.2. Fundamental Determinants of Residual Income 573 3.3. Single-Stage Residual Income Valuation 574 3.4. Multistage Residual Income Valuation 575 4. Residual Income Valuation in Relation to Other Approaches 580 4.1. Strengths and Weaknesses of the Residual Income Model 582 4.2. Broad Guidelines for Using a Residual Income Model 583 5. Accounting and International Considerations 584 5.1. Violations of the Clean Surplus Relationship 585 5.2. Balance Sheet Adjustments for Fair Value 594 5.3. Intangible Assets 594 5.4. Nonrecurring Items 597 5.5. Other Aggressive Accounting Practices 598 5.6. International Considerations 598 6. Summary 599 References 601 Practice Problems 602 Chapter 11 Private Company Valuation 611 Learning Outcomes 611 1. Introduction 612 2. The Scope of Private Company Valuation 612 2.1. Private and Public Company Valuation: Similarities and Contrasts 612 2.2. Reasons for Performing Valuations 614 3. Definitions (Standards) of Value 616 4. Private Company Valuation Approaches 618 4.1. Earnings Normalization and Cash Flow Estimation Issues 619 4.2. Income Approach Methods of Private Company Valuation 625 4.3. Market Approach Methods of Private Company Valuation 635 4.4. Asset-Based Approach to Private Company Valuation 643 4.5. Valuation Discounts and Premiums 644 4.6. Business Valuation Standards and Practices 651 5. Summary 652 References 654 Practice Problems 654 Glossary 661 About the Editors 671 About the CFA Program 673 Index 675

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