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Discussion on financial accounting problems of enterprise merger and acquisition.

Author: LiuYuJuan From: www.yourpaper.net Posted: 2010-06-01 07:53:20 Read:
[Keywords] M & a financial mechanism analysis of causes to evaluate the value of
[Abstract] the merger phenomenon in the process of enterprise development is becoming more and more common.This paper attempts to M & A of enterprises motivation mechanism and financial analysis, discusses several important issues in corporate mergers and acquisitions, find out the corresponding countermeasures to solve the financial problem of M & A of enterprises.
Enterprise merger and acquisition, enterprise development to a certain stage of rapid expansion of the effective way, currently the world's top 500 enterprises are mostly through the asset pool, mergers, acquisitions, equity participation, holding up the means of acquisition.As a result of the development of market economy, it has promoted the focus of social capital, changes of corporate structure, the upgrading of the industrial structure was a group of the world aircraft carrier enterprise.
This paper tries to explain the motivation mechanism of enterprise merger and acquisition with economics theory, analysis of reasonable orientation of financial process of M & A and the role in the enterprise, and simple analysis of financial problems in enterprise mergers and acquisitions to find things in common.
analysis of motivation mechanism of enterprise M & A
(a) the concept of merger
M & A is a general term for mergers and acquisitions.M & A is in the modern enterprise system, an enterprise through the acquisition of other enterprises of part or all of the property, thus made an investment in the control of the enterprise.On international M & A is called corporate mergers and acquisitions.
(two) motivation mechanism of enterprise merger and acquisition
Most economists put the enterprise merger as for the transfer of organizational capital purpose, or is a kind of rational behavior adopted in order to obtain the target enterprise an organizational capital.
Play a very important role in enterprise M & a financial problem, how to design a can fully reflect the financial index system of organizational capital and the implementation way, not only is the key of enterprise merger and acquisition Jl~1] completed, is crucial to avoid using conventional operation financial system of enterprise financial system instead of enterprise merger and acquisition.
(three) the financial performance of business enterprise M & A
1, to seek the financial synergy effect
Financial synergy refers to favorable impact on the financial aspects of the enterprise merger and acquisition.To achieve this kind of performance is due to the tax law, accounting practices, financial and trading securities interaction.
2, access to capital market financing ability.
Listing Corporation listed qualification is a resource for enterprises.Through the market, enterprises from the capital market to raise a huge amount without repayment of funds, but also has the ability to further the use of capital market financing listing Corporation.In addition to the special status of listing Corporation in the financing, the value of the listing Corporation is also reflected in the capital market as a public corporation and the identity of the participants and the special rights and interests of the associated.
3, access to cheap assets
Acquiring company's purchase motivation is varied, if motivation is to obtain cheap assets, when the enterprise stock below its book net assets, which means a corporate acquirers may be lower than the net assets of the enterprise value, it is feasible in finance.
The financial performance of 4, some special motivation of M & A and the
(1) the government motivation instead of enterprise motivation.
(2) back-door listing.
(3) the pursuit of "financial statements" reorganization.
(four) the reasons for the failure of mergers and acquisitions of enterprises
Many reasons for the failure of mergers and acquisitions.China currently has two main from the government and the enterprise level, the government, the main policy is not perfect and so on; the enterprises, mainly involved in the new industry of high risk, the lack of nuclear bI competition ability oriented merger thinking, analysis on target enterprise survey objective difficulty, high cost and enterprise acquisition the existence of culture conflict.
two, mergers and acquisitions in the financial analysis of
(a) the financial function of enterprise merger and acquisition
1, M & a financial analysis can achieve an efficient resource allocation
2, M & a financial analysis of the M & A activities carried out smoothly
3, M & a financial analysis contributes to the formation of the core competitiveness of enterprises
(two) the value of the target enterprise evaluation
The main contents of I, assessment of the value of target enterprise
(I) analysis of M & a financial feasibility
From the analysis of economic, feasible economically necessary condition the enterprise merger and acquisition is the merger of net income must be greater than zero.
(2) quantitative analysis of target enterprise value evaluation
Assessment of the value of the target enterprise is an important part of enterprise merger of financial analysis.The quantitative model to evaluate the target enterprise value are discounted model, P / E model and market value model three.
(3) financial analysis of M & A
Under the condition of market economy, enterprise financing can be divided into internal financing and external financing.
(three) the main method of the target enterprise value evaluation
Analysis of I, the cash merger
Analysis of 2 shares, mergers and acquisitions
three, the current our country enterprise M & A can not avoid some financial problems and Countermeasures
(a) the development of merger and acquisition of Chinese Enterprises
The merger and acquisition of Chinese enterprises in a variety of ways, with the purchase of absorption merger, acquisition, holding of liabilities, assets transfer, merger merger agreement grant of state-owned shares and legal person shares and listing form.
(two) the financial problems in the practical operation of enterprise merger and acquisition can not be avoided
1, asymmetric information, causes the enterprise value assessment is difficult to be very accurate
2, occupy the mobility of resources a large number of enterprises, resulting in reduced liquidity assets
3, need to raise substantial funds, leading to difficulties in financing enterprises limited the normal operation of enterprises and development, even make the operation of funds of Enterprises Limited, the ineffective capital turnover.
(three) corresponding countermeasures to solve the financial problem of M & A of enterprises
L, improving the situation of asymmetric information, the acquisition of assessment model of appropriate, reasonable to determine the value of the Target Corp.
2, reasonable arrangements for funding the mode of payment, time and quantity, reduce the cost of financing.
3, create the liquidity portfolio, strengthen the management of working capital.
4, according to its own characteristics, select the proper accounting treatment.
5, combined with the actual operation, effectively control the cost of the acquisition.
In short, mergers and acquisitions as an important means of enterprise capital operation, has important significance for the development of enterprises.M & A has also brought a series of problems in bring benefits to the enterprise at the same time.In the process of mergers and acquisitions, in order to reduce the risk, reduce or avoid the adverse effects of mergers and acquisitions, should choose good ideal Target Corp, careful evaluation of the value of the Target Corp, and goals of the business process, create the optimal capital structure of the Target Corp, increase the value of the company, the enterprise merger and acquisition give full play to the synergy of enterprises, to market quickly, improve the operating scale, mining, management and other aspects of the potential.
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