Working Capital and Financial Environment Paper Essay

Working Capital and Financial Environment Paper - Essay Example The total amount is $10493m. They are collectable within a year. Current liabilities - is another balance sheet item. It is the sum of money owed by an organization that is due for payment within a period of one year. For GlaxoSmithKline, current liabilities for year 2005 as given in the financial statements include elements such as: - Trade and other payables - trade payables, wages and salaries, social securities, other payables, deferred income, customer return and rebate accruals, other accruals, dividends payable, derivative financial instruments - $1,0091.7m Financial regulators such as IFRS body are seen as international marks quality and transparency and thus boost the image of the reporting Entity (Michael W. Maher, William N. Lanen, Madhav V. Rajan. 2004). 4. Mitigation of risks. Effective control also ensures that risks are identified early and assessed properly inorder to come up with timely mitigation plans. This is because it is not possible to completely eliminate risks in such areas as research and development where it's not certain whether investment will bear significant returns.. 7. Control programs also ensure group's compliance with audit functions, as well as regulations and ethical codes of practice. This ensures the integrity of financial statements (Horngren, C., Sundem, G. and Elliott, J. (1991). (i) GSK has... Cash and cash equivalents Short term investments Accounts receivables Short term loans Inventories Pre-paid expenses and taxes Assets held for sale Total current assets = $41,896m (Pfizer financial reports 2005) Current liabilities - This is money owed by the company and repayable within one year. For Pfizer Inc. current liabilities include: - Short term borrowings ($11,589) Accounts payables ($2,226)m Dividends Payables ($1,772)m Income tax payable ($3,617)m Accrued compensations and related items ($1,720)m Other current liabilities ($7,522)m Liabilities held for sale ($2)m Total current liabilities are given as $28,448m = 28.45 billion dollars Working capital is therefore $41,896 - $28,448 = $13,448 = $13.45 billion b. Explain the functions of intermediaries and financial regulatory bodies with the company. Functions of intermediaries and financial regulators Financial regulators such as IFRS body are seen as international marks quality and transparency and thus boost the image of the reporting Entity (Michael W. Maher, William N. Lanen, Madhav V. Rajan. 2004). They provide a platform for comparison of similar companies in same Industry and therefore boost standardization. They also enhance financial reporting ensuring that companies understand risk controls and management and understand the impact of finance in business activities. They ensure compliance of set rules and regulations within the particular industry. C. Determine the importance of control programs and effective internal control techniques to the selected organization. Discuss the impact of the 2002 Sarbanes- Oxley Act. For GlaxoSmithKline good control programs are important due to the following reasons: - 1. They enable the board to present a balanced and