ISABELLE DYNAH E.

GUILLENA
12- ROCKFELLER 2/21/19
1. Now that the heirs of Henry Sy are the ones running their
businesses, what do you think will be the changes in terms of how
funds will be allocated in their businesses?
>> I highly think Mr. Henry Sy would have included it in his last will and
testament on how the Sy empire would be evenly distributed. The changes
will be drastic if his children would alter how the late senior ran his
businesses. For now, you haven't heard from the news of anything related to
the current status of the Sy empire, and I take that as a good sign
2. What is/are the reason/s why companies borrow money despite
the fact that the businesses have available funds?
>> If a company does borrow money despite having available funds. it probably
was forecast that something unpleasant will happen. In which it requires
additional funds to make up as a precautionary measure.
According to Mr. Eval Lifshitz, founder and CEO of BlueValue, as the high
finance set understands not all borrowing is bad. He also mentioned how
companies prefer having debt rather than giving up equity. It usually costs
less. That debt also can be cheaper than your opportunity cost. He
insinuated that one can profit more from debt becuase it will open up new
growth channels. Lastly, the most beneficial thing debt has--still according
to Mr. Lifshitz-- is that paying interest on debt reduces tax burden. The cost
of interest reduces one's taxable profit and, reduces the tax expense.
3. If you were to put up a business, what will be the possible sources of
capital to fund your desired business? Explain each.
>> Taken from BDC.ca, there are seven (7) possible sources of start-up
businesses:
1.Personal investment - Your first investor should be yourself—either with your
own cash or with collateral on your assets.
2. Love money - This is money loaned by a spouse, parents, family or friends.
Investors and bankers considers this as "patient capital", which is money that
will be repaid later as your business profits increase.
3. Venture capital - Venture capital is a form of early-stage financing sought
by companies with high-growth ambitions and significant capital requirements.
It is provided by venture capital companies or institutional investors rather than
by individuals.
4. Angels - Angels are generally wealthy individuals or retired company
executives who invest directly in small firms owned by others. They are often
leaders in their own field who not only contribute their experience and network
of contacts but also their technical and/or management knowledge.
5. Business incubators - Business incubators (or "accelerators") generally focus
on the high-tech sector by providing support for new businesses in various
stages of development. However, there are also local economic development
incubators, which are focused on areas such as job creation, revitalization and
hosting and sharing services.
6. Government grants and subsidies - Government agencies provide financing
such as grants and subsidies that may be available to your business.
7. Bank loans - are the most commonly used source of funding for small
and medium-sized businesses. Consider the fact that all banks offer different
advantages, whether it's personalized service or customized repayment.
4. Is it important for businessmen to know the accounting process
despite the fact that they hire their own accountants? why or why not?
>> I do think it is important. Because just like in college, any business
related course take accounting as a subject. Whether they would major in it
or not, the important thing is that they have a background for accountancy.
Yes, you may have accountants with you and financial analyst and all that.
It's still important for businessmen to know the fundamentals of
accountancy and that includes the process. They need not to delve in real
deep as if they would need to take a crash course. Rather they should just
be aware of the accounting process because it involves their business.