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Financial Management Assignment: Ethical Aspects Of Business

4 Dyson, which is a UK based company, launched a project to manufacture electric cars in Singapore. However, this project examined in the financial management assignment could not be implemented successfully. The company realized that the project was not financially viable and due to this reason, the company announced plant shut down (BBC News, 2020). The company made error in estimating the cost and later on it was found that the product is not able to recover the cost. In order to launch an overseas project, it is important that the project risk and opportunities are identified and evaluated deeply. There are many aspects from the macro as well as micro viewpoints which needs attention. The major factors to be analyzed in such a scenario are economic and political conditions of the country. Further, assessment of competition is also a crucial aspect as it provides insight into the position of competitors and helps the company to make strategy to place itself in the market (Doktoralina and Apollo, 2019). In the case of Singapore, the economic, political, and competing conditions should have been evaluated as below: Economic Factors The economic conditions of a country are displayed by two essential macro-economic factors such as GDP growth and inflation. Singapore has high GDP growth rate and the country is assessed as one of the highest income earning countries in the world. Thus, from the economic view point, the choice of location (Singapore) is fine (Rastogi and Trivedi, 2016). Political Factors There has been high level of trust and stability in the governance structure of Singapore. Thus, the political risk in Singapore is negligible. The politics in Singapore is based around the democratic environment. Competition There is no direct competitor for electric cars as it was the new product brought in by Dyson only. However, the indirect competitors are many. There are companies such as Volkswagen, Ford, and Tesla that gives tough competition in the Automotive market (Andrew.cmu, 2020). Cash Flows and Cost Estimates Further, after conducting macro analysis within this financial management assignment, the project evaluation process expands on micro level analysis which involves assessing the project’s financial viability. This is the area where Dyson could not assess properly. The company should have prepared estimate of the free cash flows basis the budgeted numbers of cost and revenues. Further, while assessing the cost, it should be on cards that the company takes into account all relevant costs of manufacture. The relevant cost of manufacture includes the variable cost as well as additional fixed costs and out of pocket expenses. The decision whether to undertake the project or not would depend upon the fact that whether it is generating cash profits for the company or not. The company needs to go ahead with the project only when the project has capability to generate cash profits. References Andrew.cmu.2020. Electric Vehicle Competitive Analysis.[Online].Financial Management assignmentAvailable at: [Accessed on: June 7, 2020].BBC News. 2020. Dyson has scrapped its electric car project. [Online]. Available at: Doktoralina, C. and Apollo, A., 2019. The contribution of strategic management accounting in supply chain outcomes and logistic firm profitability. Uncertain Supply Chain Management, 7(2), pp.145-156. [Accessed on: June 7, 2020]. [Accessed on: June 7, 2020]. 2019.Air Transport Services Debt to Equity Ratio 2006-2020 | ATSG.[Online]. Available at: Mari, C. and Marra, M., 2019. Valuing firm’s financial flexibility under default risk and bankruptcy costs: a WACC based approach. Financial Management assignmentInternational Journal of Managerial Finance. McKinney, J.A., Emerson, T.L. and Neubert, M.J., 2010. The effects of ethical codes on ethical perceptions of actions toward stakeholders. Journal of Business Ethics, 97(4), pp.505-516. Rastogi, N.I.T.A.N.K. and Trivedi, M.K., 2016. PESTLE technique–a tool to identify external risks in construction projects. International Research Journal of Engineering and Technology (IRJET), 3(1), pp.384-388. Vanclay, F., Baines, J.T. and Taylor, C.N., 2013. Principles for ethical research involving humans: ethical professional practice in impact assessment Part I. Impact Assessment and Project Appraisal, 31(4), pp.243-253. YapaAbeywardhana, D., 2017. Capital structure theory: An overview. Financial Management assignmentAccounting and finance research, 6(1).

Subject Name: Business ethics

Level: Undergraduate

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