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MAR2116
Introduc tion to Business Mgmt
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Ms Tok Seok [email protected]
64606467
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Financ ia l & Manageria l
Ac c ounting, The Basis
for Business Dec isions16th ed ition,Williams, Haka , Bettner,
Carc ello,Mc GrawHill Intl
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B U S I N E S S S T R U C T U R E S
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Top ic 1
Business Struc tures
Sole-p rop rietorship
Partnership
Company Sole-proprietorship
PartnershipCompany
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some COMPANIES in Singapore
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NOT companies:
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Top ic 1
Business Struc tures
Sole-p roprietorship
Partnership
Company
Limited Liability Partnership
Limited Partnership
Limited by shares
Limited by guarantee
Unlimited liability
Public
Private
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CHARACTERISTICS OF
COMPANIES
LimitedCompany
Separatelegal entity
Limitedliability
Continuity ofexistence
Separation of
Ownership &management
Ease oftransferabilityof ownership
Regulations
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ADVANTAGES & DISADVANTAGES
Company
Higher tax rate
Protectionconferred by
limited liability
Ability to raisecapital easily
Separate legalexistence
Shareholdersneed notmanage
Perpetual life
More regulations
Agency cost
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FORMATION OF COMPANIES
Minimum of one member Register name of c ompany
Memorandum of Assoc iation
Artic les of Assoc iation
Certific ate of Incorporation
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types ofSHARES
ordinary shares
preference shares
Concept of Dividends
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Initial Pub lic Offering
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14
Corpora te Governanc e
Corporate Governance refers to theprocesses and structure by
which the
business and affairs of the company aredirected and managed, in
order toenhance long-term shareholder value
through enhancing corporateperformance and accountability,whilst
taking into account the interests
ofother stakeholders.
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Stakeholders Government
Environment
Shareholders
Management Consumers
Suppliers Employees
Local Community
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Authority
Responsiblefo reverything
thathappens intheorganisation
Responsib le to extent ofauthority deleg ated
Board
Sha reholders
Management
Accountability
Board
Sha reholders
Management
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Corpora te Governanc e
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Corpora te Governanc e
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Overview Singapore Code
Issued in 2001, revised in 2005, currently underreview
Under purview of SGX and MAS
Corporate Governance Council set up in Feb2010
Not prescriptive nor non-prescriptive approachbut a balanced
approach
Disclosure based
Listed companies on SGX are required to disclosetheir corporate
governance practices and give
explanations for deviations from the code in theannual reports.
Comply or Explain approach.
14 Principles, with Guidelines and Commentaries
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Overview Singapore Code
Best practices of the Code include having a strongand
independent Board, adopting transparentprocedures and maintaining
sound systems ofinternal controls.
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Code
ofCorporate
Governance
BoardsConductof Affa irs
The 14 Princ iples in the Code of CG
Board
Composition
Chairmanand CEO
BoardMembership
BoardPerformance
Ac c ess toInformation
Proc edures forsetting policy
Accountability
Audit
Committee
InternalControl
InternalAudit
Board Matters
Remuneration
Matters
Level and Mix
Disc losure
Accountability& Aud it
Communication
with shareholders
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Ac tivity time.. Qn 1 & 2
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F I N A N C I A L A C C O U N T I N G
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What is Ac c ounting? Language of Business
Businesscommunicatesinformation tousersto enable them tomake dec
isions
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What is Ac c ounting?
Source : Financ ial & Ma nagerial Ac c ounting , The Basis
for BusinessDec isions,16th ed ition, William s, Haka, Bet tne r,
Ca rc ello,McGrawHill Intl
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Source : Financ ial & Ma nagerial Ac c ounting , The Basis
for BusinessDec isions,16th ed ition, William s, Haka, Bet tne r,
Ca rc ello,McGrawHill Intl
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2 Disc ip lines of Ac counting
Financial
Accounting
Managerial
AccountingU s e r s
owners
creditors
government
employee mgmt
public customer/suppliers management
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The Ac c ounting Proc ess
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The Ac c ounting Equa tionAssets = Liabilities + Owners
Equity
ASSETS
LIABILITIES
OWNERSEQUITY
=
