Globalization is defined as the freer movement of people, goods, services, and ideas around the world (Petersen, Frayer, & Scannell, 2000). In a globalized world, national borders become porous, as connections between people and organizations are transformed by ever-changing cultural and economic forces (Petersen et al, 2000). At the same time, businesses need funding on a regular basis for ongoing expenses such as payrolls, utilities, and supplies; for investments in the future like research and development; and for long-term investment in buildings and equipment (Summerville, & Dai, 2012). To meet these needs, companies can tap a number of resources, both internal and external (Zhang, 2014). In this paper, I will discuss methods for sourcing
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The provisions relating to a debenture are laid down in a trust deed, and a trustee is appointed to act on behalf of the debenture holders.
Traditional bank overdraft A bank overdraft gives a business the right to borrow up to a predetermined limit for an agreed period of time (Eiteman et al, 2013). Bank overdrafts represent a flexible approach to short-and medium-term financing as interest is paid only on the amount borrowed. Bank overdrafts are usually an expensive form of debt financing, but the cost will vary with the credit rating of the business arranging the facility (Eiteman, et al, 2013).
Working capital term loan It is an agreement to borrow a specific amount of money for a specific period of time at an agreed rate of interest (Eiteman et al, 2013). Security for the loan is usually provided by a fixed charge over an asset. The loan is repayable over a fixed period and the repayment pattern can vary from lender to lender …show more content…
Another way of stating the advantage that global markets have over the domestic market is that the global market cash flows are more diversified than in that of the domestic market. It is important to note that international diversity comes with costs such as agency costs, political risk, and exchange rate risk (Bertomeu, 2015). Being listed in foreign stock markets may decrease the possibility of takeover by other firms. An acquiring company may worry about the laws of other countries and foresee the difficulty in working with widely dispersed shareholders (Bertomeu,
The provisions relating to a debenture are laid down in a trust deed, and a trustee is appointed to act on behalf of the debenture holders.
Traditional bank overdraft A bank overdraft gives a business the right to borrow up to a predetermined limit for an agreed period of time (Eiteman et al, 2013). Bank overdrafts represent a flexible approach to short-and medium-term financing as interest is paid only on the amount borrowed. Bank overdrafts are usually an expensive form of debt financing, but the cost will vary with the credit rating of the business arranging the facility (Eiteman, et al, 2013).
Working capital term loan It is an agreement to borrow a specific amount of money for a specific period of time at an agreed rate of interest (Eiteman et al, 2013). Security for the loan is usually provided by a fixed charge over an asset. The loan is repayable over a fixed period and the repayment pattern can vary from lender to lender …show more content…
Another way of stating the advantage that global markets have over the domestic market is that the global market cash flows are more diversified than in that of the domestic market. It is important to note that international diversity comes with costs such as agency costs, political risk, and exchange rate risk (Bertomeu, 2015). Being listed in foreign stock markets may decrease the possibility of takeover by other firms. An acquiring company may worry about the laws of other countries and foresee the difficulty in working with widely dispersed shareholders (Bertomeu,