Fluent Essays

This assignment seeks to integrate the course concepts found in the textbook Fundamentals of Corporate Finance 10 edition by Richard A Brealey, Stewart C Myers, and Alan J Marcus and integrate them with Biblical concepts. More specifically, you will write an essay describing how the Bible is related to the topics covered in the course.  Instructions Below are the specifics requirements for this assignment: · The essay must be at least 1,500 words and include a clear integration of the Bible in relation to a course topic, · You must use at least 2 scholarly sources to substantiate your position (you may use the textbook as 1 source).  · Sources must be cited in current APA format.  I have attached examples of the paper I found online that can be used to assist you. If you have questions, please ask as this is a quarter of my gradeRunning head: FAITH INTEGRATION FAITH INTEGRATION 4 Abstract What is a business run without Christian principles? Can it be successful and serve its customers, employees, and community? The authors provide a detailed analysis of these questions in the following paragraphs. Regardless of the organizational and capital structures, the integrity of the financial proformas creates trust and transparency among all the different layers of the business; internal and external. The Bible provides key points on the behaviors, thinking, and vision one should have to operate a business effectively, by creating a positive impact on the surrounding ecosystem. Following, the authors provide a correlation on the topics of corporate forms and function, financial statement integrity, and debt to the principles exposed in the Bible. Corporate Forms and Functions Corporations can be structured in many different ways, but no matter how one is organized, this structure is an integral part of any success the corporation may achieve (Brealey, Myers, & Marcus, 2018, p. 9). In Paul’s first letter to the Corinthians, he tries to convey the importance for the Church to organize and structure itself utilizing the distinct, varying spiritual gifts of each Christian within that structure. 1 Corinthians 12:12 (NIV) states: “Just as a body, though one, has many parts, but all its many parts form one body, so it is with Christ.” In this same way, a corporation must organize itself in the most advantageous way for that company and at the same time best utilize the distinct, varying gifts its management team and skilled workers bring to the table. Brealey, Myers, and Marcus (2018) explain that a corporation is a “distinct, permanent legal entity” that may be privately owned or have its shares traded in public markets (p. 9). While diverse and alternative corporate forms, governance, and company objectives are becoming increasingly more common, the basic goal of every corporation is to generate value by maximizing the positive impact on its stakeholders while limiting all negative impacts (Boeger, 2018, p. 10). The smallest of the corporate structures is the sole proprietorship (Booth, 2003, p. 1434). The sole proprietor can be viewed as being much like the temple of God that is the individual Christian. Each Christian is responsible for his or her own actions, and in this same way, the sole proprietor is legally, personally responsible for any debt their business may accrue (Brealey, Myers, & Marcus, 2018, p. 9). At the opposite end of the spectrum, the general corporation is much more similar to a large church with many members. A large corporation has a board of directors, executive officers, and perhaps hundreds of thousands of shareholders (Brealey, Myers, & Marcus, 2018, p. 9). In this same way, the Church is structured with a lead pastor, perhaps an array of assistant pastors, a “board” made up of deacons and elders, and many “shareholders” who are members of the Running head: FAITH & BUSINESS 1 FAITH & BUSINESS 3 Abstract Integrating faith and business is a commitment that is initiated at the very beginning of an organization. Having faith as the foundation of a business is a standard that should be set as precedent so that it is ingrained in the roots of how employees choose to do business. Keeping this standard and not compromising a business’s integrity is not always easy but should be a priority. This paper discusses how business integrates corporate goals and finance with faith. How a business decides to conduct its business as well as how its faith effects its performance is integrated throughout this paper as well. Businesses also face many challenges during that initial phases of the starting and keeping the moral integrity is key to further success. Finding that balance in business and faith can be difficult but relying on the support of trusted allies and standing firm on God’s word will give you the strength to endure. The first two topics we learned about in this course are corporation’s goals and governance and accounting finance and performance which makes it suiting that the first part of this essay includes these topics. Financial goals are target goals such as saving for your kid’s college or saving money for retirement. Many people set financial goals in hope of reaching them but some may fail and fall into debt. In 2 Chronicles 15:7 the bible says, “But as for you be strong and do not give up for your work will be rewarded.” God states that he will reward you and he will take care of you in every situation, he is watching, he is listening and he has a greater plan for your life. Corporate governance is another large issue in all companies not just in finance. Corporate governance is known as “the rules under which firms are operating” or “the actual behavior of corporations, in terms of such measures as performance, efficiency, growth, financial structure, and treatment of shareholders and other stakeholders” as stated by Stijin Classens and Burcin Yurtoglu (2013). This means that corporate governance is basically the rules you follow in the financial world. It is important in any situation to have rules and regulations just like it is imperative to have rules to get to heaven. Financial performance in accounting is also a huge topic to be discussed in the finance world. Financial performance is how well a firm can use all its assets to make more money or bring in more revenue. Three ways to keep up with your financial performance would be balance sheets, income statements and cash flow statements. All of these statements will help gather information on how well your finances are and are likely to help a company manage revenues. Although these statements are usually a good thing sometimes they can give managers a summary of how well you are doing in the company. This makes it more tempting to lie or cheat in order to keep your job. Luke 16:10 says, “One who is faithful inRunning head: GROUP 1 FAITH INTEGRATION 2 GROUP 1 FAITH INTEGRATION 2 Introduction In today’s constantly changing world, applying Christian values to finance is not an issue that has been explored in depth. There are many assets (stocks, bonds, derivatives, fixed assets, etc.) companies and investors own, with each bearing the potential for return and risk. For financial managers and investors to act in accordance with their Christian faith, they would first have to seek to learn from the biblical principles about the way in which they act on behalf of others. “Whoever loves money never has enough; whoever loves wealth is never satisfied with their income. This too is meaningless.” (Ecclesiastes 5:10, New International Version) Goals and Corporate Governance For organizations to be successful, they need to set up goals, which will be guide their operations. In addition, they also need to have a good corporate governance which will function to ensure that all the operations within the organization are in line with the goals of the organization.  Corporate governance and goals are the basis for the success of an organization. The two work hand in hand where goals act as guidance for the governance of an organization to make the organization achieve long term goals. Through corporate governance, the organization will be controlled and directed towards the achievement of the objectives of the businesses (O’Mahony & Mason, 2017). This is how they will lead to success of the company since the objectives will be met through corporate governance. Corporate governance is advantageous to an organization in that it ensures that there is economic growth for the organization because of organizations performs well when it focuses on its goals and objectives. Also, with good corporate governance, investors will feel attracted to invest in the business and this will help in increasing the capital for the organization. This will then lead to a lower capital cost which is very attractive as it leads to a positive share price (Yermack, 2017). As a result, organizations should be working to ensure that they have a good corporate governance. This is what the bible advocates for. The Bible encourages us to set goals as well as back them with good governance which will not give up and everything will be okay. The success of anything we do will be down to the goals we set as well as the governance that will be backing the goals. Chronicles 4:10 (NIV), “But as for you, be strong and do not give up, for your work will be rewarded.” Company Value and Stocks A company’s value and stock prices go hand in hand. When there is any change in the value of stock, that change is also seen in the company’s overall value. For this reason, financial managers and investors keep a close eye on stock prices. According to Brealey, Myers, and Marcus (2018) stock prices and company values are the major determining factors in how successful a company is current and how successful tRunning head: GROUP THREE – FAITH INTEGRATION 1 Faith Integration 4 Abstract This group essay will provide a Christian vantage point to help the reader understand topics of finance in a Biblical sense.  Each topic will reflect greater understanding of God’s word in today’s global market.  The essay is designed to show the relevance of faith integration when doing business in Corporate America.  In scripture, the topic of finance is addressed and suggests stewards practice proper morals and ethics in their dealings.  The structural design of finance in God’s word is to provide guidelines for the development of mankind.   Key Words:  Finance, Corporation, Christian perspective, God’s will Introduction In an ever changing world, the Biblical perspective on finance is important to understand to keep with God’s will.  Faith integration manifests itself within the practice of leadership through the understanding of God’s word in the Bible.  The Bible outlines financial principles that Christians should obey in order to please God.  Financial prosperity is outlined in II Timothy 3: 16, “all Scripture is given by inspiration of God, and is profitable for doctrine, for reproof, for correction, for instruction in righteousness” (NKJV).  Stewardship can be considered the most important aspect of a Christian’s faith.  Goals and Governance of the Corporation Religion, particularly Christianity, is not a new element to goals and corporate governance. A corporation is defined as “a business organized as a separate legal entity owned by stockholders” (Brealey, Myers, & Marcus, 2011, p. 8). It is imperative that any organization have a set of goals and governance to be successful. Corporates must use these tools to maximize value for the stakeholders. According to Inauen, Rost, Osterloh and Frey (2010), religious insight into the economic perspective is “worth paying attention to such concepts as faith, spirituality and religion in western organizations,” (p. 39). As we study the Bible, there are several principles that apply to finance. The main principle is to understand that God is the source of all things. Philippians 4:19 states, “My God shall supply all your need according to his riches in glory by Christ Jesus” (NIV). God is omnipotent and omnipresent. Leaders in positions of influence and decision-making should seek Godly counsel when the final outcome affects the masses. “Blessed is the man that walketh not in the counsel of the ungodly,” Psalm 1:1 (KJV). A Christian CFO’s mission should be to keep the organization out of unnecessary debt and avoid bad investments. According to Proverbs 22:7, “the rich rule over the poor, and the borrower is slave to the lender,” (NIV). Accounting and Finance Accounting and finances are an important and integral part of organizations. An organization would not be able to sustain without knowing their financial position. Organizations customarily utilize accounting sheets suchRunning Header: Group 4 Faith Integration 1 Group 4 Faith Integration 2 The world of business is pressure filled and burdensome. There are deadlines and quotas which need to be met and at times the strain can be unbearable. Stress may come from several different directions which often cause those in senior managerial positions to make immoral or unethical decisions. Companies have done this in the past and sadly more will do it in the future. Stress is not always a bad thing; however, when there is impossibly high expectations to make more money, to create a more efficient company, to be better than competitors and to do better than previous years it can lead people to do almost anything to meet these expectations. Corporations, such as Enron and Freddie Mac, who tweaked numbers and falsified books on multiple occasions lead the government to pass laws such as the Sarbanes-Oxley Act. These stringent laws have made finance and accounting significantly more complex and difficult, leading some corporations to return to the private sector or to list their shares in overseas markets instead of in the United States (Brealey, Myers and Marcus, 2018, p. 72, par. 1-2). “With transparency, corporate troubles generally lead to corrective action” (Brealey, Myers and Marcus, 2018, p. 71, par. 6). When companies are transparent and honest with their struggles they can learn how to fix and heal their business. Trials and stress may cause some people to fold, but it also forces people to make changes and to learn from their mistakes and become better. By cheating the system or manipulating the numbers mistakes and problems are only temporarily buried or kicked down the road, but sooner or later the truth will come out. Galatians 6:7 teaches the lesson, “Be not deceived; God is not mocked: for whatsoever a man soweth, that shall he also reap” (King James Version). We reap what we sow. Either we sow corruption and deceit and reap the consequences of dishonesty and poor ethics or we learn from our mistakes and the mistakes of others to create a more Christ-like environment. More often than not we will come out further ahead than we would have had those trials and hardships not come. Financial markets and institutions are important to business because they are there to help with financing that they need. When a business is trying to start up or when they need a little help they have to go to a financial institution so they can get the money that they need to start. “Businesses have to go to financial markets and institutions for the financing they need to grow. When they have a surplus of cash, and no need for immediate financing, they have to invest the cash, for example, in bank accounts or in securities” (Brealey, Myers, & Marcus, 2018) The Bible talks about the rich and the poor and borrowers and lenders and how they are all related. Proverbs 22:7 says “The rich rules over the poor, and the borrower is the slave of the lender.” Rea