U.S. multi nationals often leave foreign profits overseas to avoid U.S. taxes. Should those profits and cash flows be identified by firms? Since these are “permanently reinvested” overseas, would you change your opinion of the firm’s value? Why or why not?
Should sustainability standards be promulgated and should firms be required to adopt them? Should they be audited? Who benefits from such disclosures? Would these disclosures affect decisions you make about a firm? How?
Do managers of firms have a fiduciary responsibility to shareholders to minimize the tax burden? Why or why not? Do you agree with Senator Levin that the tax avoidance efforts of Microsoft and other firms are “shenanigans”? If so, who is to blame, the firm or those who write tax law?
Firms can choose to mark to market their own debt. However, the resulting gains and losses were counterintuitive. Does the new rule that re-labels gains and losses as “other comprehensive income” help users? If so, how? If not, why not?
What financial evidence is used to argue that H.P. is struggling? What advice would you give Whitman? How would your advice manifest itself in improved financial results?
Name several of the variables that have contributed to the $1 trillion underfunded public pension plans. If you had the power to “dictate” a solution, what would it be?
How do carbon-emission credits control pollution if a firm is able to buy unlimited credits to pollute? Who ultimately pays for these credits? Is it possible for California to prevent the pollution emitted in surrounding states? What do you think the journal entry would be for the purchase of carbon credits?
Should at least 40% of members of boards of directors be women? Why or why not? Should companies be forced to appoint more women directors? Why or why not?
An activist investment fund has increased its ownership of Office Depot to just over 13%. Is this sufficient to exert significant influence? Control? Why would the fund focus on cutting expenses to increase profitability? How might this strategy affect future sales and profitability?
How does the added information about integrated reporting (i.e., reporting about environmental, social, and governance factors, or ESG) make investors a “happier group”? Do you agree with this assessment? Should ESG reporting be mandated? Why or why not?
McDonald’s is opening vegetarian only restaurants in India. List as many implications as you can for the company, such as those pertaining to the supply chain, order procedures, storage, marketing, working capital, margins, etc.
Is there any convincing reason to have a budget? Why do you suppose educators continue to teach budgets and “variance analysis”?
If you were the CFO of a privately held company, under what circumstances would you want to release financial information? To whom would you release it? How often? If never, why not?
How can a firm’s capital structure become a “political liability”? Do you think the lawsuit against the U.S. Department of Transportation has merit? What ratios would you check to see if the firm’s debt structure really was “troubling”?
What would you advise the chair of the SEC, Mary Shapiro, with respect to the “quiet period” before an IPO? Should it be upheld as is, changed, or completely eliminated?
AOL recently announced a special dividend and an accelerated share repurchase. Do you agree with their move? Why or why not? What’s the difference between a special dividend and a “regular” dividend?
Why does Usain Bolt not want to run in England? How do tax rates affect the allocation decisions of financial capital? Of human capital?
Do tax rates affect individuals’ behavior? Corporate behavior? Can you make a case at all that these companies who are leaving the U.S., such as Eaton, should stay in the U.S. and pay more in taxes?
