Dividends & Disbursements
A distribution of a portion of a company's earnings, decided by the board of directors, paid to a class of its shareholders.
What are dividends?
The first stage in the risk management process, where potential threats to the business are identified.
What is risk identification?
The least complex and lowest-risk method of international market entry, simply selling goods directly to a foreign buyer.
What is exporting?
The primary goal of most for-profit businesses.
What is profit maximisation?
The income remaining after all costs and expenses are deducted from sales revenue.
What is profit?
The financial disbursement where a business pays its suppliers for goods or services purchased.
What are accounts payable (or payments to creditors)?
A strategy to deal with risk by purchasing insurance to cover potential financial losses.
What is risk transfer?
A market entry strategy where a business grants the right to a foreign company to use its name, product, and systems in exchange for a fee and royalties.
What is franchising?
A business's commitment to behave ethically and contribute to economic development while improving the quality of life for its stakeholders.
What is Corporate Social Responsibility (CSR)?
A performance indicator calculated by dividing Net Profit by Total Sales Revenue.
What is the Net Profit Margin?
The record date, ex-dividend date, and payment date are all key parts of this process.
What is the dividend payment process?
Risks stemming from internal processes, people, and systems, such as employee fraud or IT failure.
What are operational risks?
A partnership between two or more companies, often from different countries, to undertake a specific business venture.
What is a joint venture?
These are the individuals, groups, or other businesses who have an interest in the operation and performance of a business.
What are stakeholders?
The ability of a business to meet its short-term financial obligations as they fall due.
What is liquidity?
A type of dividend where the company issues additional shares of stock instead of cash.
What is a stock dividend?
The opposite of risk transfer, this strategy involves making a business decision not to participate in an activity that may carry risk.
What is risk avoidance?
The main political risk when entering a foreign market, where a government takes ownership of foreign assets.
What is expropriation (or nationalization)?
Businesses that are owned and controlled by the public and aim to provide essential community services rather than generate profit.
What are government enterprises (or public sector businesses)?
A non-financial indicator that measures how well a business is managing its workforce and is often measured by staff turnover rates.
What is employee satisfaction (or worker productivity)?
The term used for the general outflow of funds from a business, including expenses, payroll, and dividend payments.
What are disbursements?
The financial concept that describes the potential trade-off between the expected return from an investment and the degree of risk taken.
What is the risk-return trade-off?
When a business establishes a wholly owned subsidiary in a foreign country by either building new facilities or acquiring an existing local company.
What is Foreign Direct Investment (FDI)?
The five main resources a business needs to operate: Materials, Machinery, Money, Management, and this final 'M'.
What is Manpower (or Labour / People)?
This is a measure of how effectively a business is using its assets to generate revenue, often expressed as Return on Assets (ROA).
What is efficiency?