Файл: тексты на семестр.doc

After calculating all of the entries in its balance of payments, a nation has either a net inflow or a net outflow of money. The most direct means of correcting a deficit in the balance of payments and having an immediate impact is by imports’ reduction. This can be accomplished by imposing additional taxes, or quotas, or both.

---

Text 7 - globalization of world economy

Globalization is understood as increasing internationa­lization of ideas, science, communication and technology, and it must be distinguished from economic globalization. The latter means the process of integration of markets, great changes in trade and finance and the establishment of the global eco­nomy. The main aim of economic globalization is to change the world into one dynamic market, which has uniform characteristics in different countries. Globalization should lead to a free mobility of capital, as well as to privatization of the economy and a sharp reduction in government budgets. Besides, globalization means wide advertising of new consumer products all over the world, low taxes for producers - both domestic and foreign - and similar life-styles for people of different nationalities.

First steps towards globalization in Europe were made by the establishment of the Common Market in 1993, and the introduction of the "euro" as the new single currency for Europe on January 1, 1999. Since that time, the euro has been used in foreign trade transactions by the countries that joined the euro-zone. Euro banknotes were introduced in circulation in twelve member-countries of the European Union on January 1, 2002.

Some countries of Central and Eastern Europe have recently joined the European Union, such as Lithuania and Poland, while others are planning to do it in the near future. However, in order to transform the former planned economies into really mixed economies, countries of Eastern Europe must increase sharply the levels of productivity and competitiveness of their economies. Special adjustments should be made in agriculture, tax system and in the system of social security.

Economists think that the single currency will increase trade integration, as well as labour mobility in the euro-zone. The introduction of the new currency and participation of different countries in integrated European financial markets should reduce any risks in business transactions and lead to more efficient European finance, promote both European political and economic integration.

Globalization at a business level means that a company has decided to participate in the global economy and it is going to establish its subsidiaries in foreign markets. However, a company will have to adjust its products or services to the consumers' requirements in a foreign country. Nowadays any company may do e-business using the Internet services in order to attract wider clientele.

Text 8 - modern management structure

A company, whether private or public, is governed by a Board of Directors, which comprises between two and a dozen top-managers. The directors are generally elected or appointed by the shareholders to run the business on their behalf with the objective to achieve satisfactory profits, for a large enterprise may have hundreds or thousand of shareholders and it would therefore be impracticable, if not impossible, to consult each one every time that a decision has to be taken. In a way, the Board is the ‘watch-dog’ of the shareholders’ interests; it is trustee of the funds invested by them in the company and it is responsible for ensuring the proper application of those funds. The Board is also answerable for formulating the policy, which will best enable the company to achieve its objectives, for ensuring that the laid down policy is implemented and adhered to, and for making any amendment to the policy, which may be necessary from time to time. The Board must be kept informed of all financial matters related to the business, it must ensure that sufficient finance - working capital - is available, and must sanction capital expenditure. In addition, the Board is responsible for ensuring that the enterprise operates in accordance with the legal and statutory requirements of the country where it works.

The Chairman of the Board (or the President) is a director elected to the post, in theory by other directors and sometimes by the shareholders. In practice the Chairman may be a principle shareholder or have strong political and financial connections, or be elected because of his knowledge, experience, natural leadership abilities, entrepreneurship, popularity, seniority or for some other special qualities. The Chairman also represents the company in the bodies of the government, press conferences, etc., and he is unlikely to hold an executive position, enabling him to devote his time and energies to matters, which concern top management.

---

Executive Directors work full-time for the company, and are therefore in constant touch with the activities of their respective department in addition to being involved with the affairs of the board. Nevertheless, as heads of a department an executive director assumes personal responsibility for running his branch of the business and for implementing the policy and decisions of the board relating to it. The advantage of having ‘specialist’ executive directors readily available for discussion and consultation can be offset by the fact that they may be limited in their overall view or knowledge of the company.

Executive officers (colloquially called ‘executives’) are classed into chief and senior executives, middle managers and supervisors. Senior Executive Officers, or Chief Executive Officers (typically abbreviated to CEO), are most of the time divisional or departmental managers. Middle managers are subordinates and assistants to senior managers in charge of certain specific activities, and they execute control over supervisors (foremen and junior managers) who in turn direct the actually working lower staff members.

---

Text 9 - planning in business

Planning entails deciding how the predetermined objectives of a business, or a section or department of it, should be achieved in the most efficient and economical way in accordance with the managerial policy.

However, in other cases considerable thought and research may be necessary before deciding to produce or to provide something not already available or which is likely to be able to compete successfully with similar goods or services existing on the market. Numerous factors - such as finance and resources available or which can be made available, the market potential, facilities which will be required, and so on - may have to be considered before a decision on viable objectives of a business is finally reached.

Hand-by-hand with the decision on the objectives of the business is the necessity to decide in broad terms how and where the set objectives are to be achieved, that is, to lay down the basic policies of the business. Policies, being really the attitudes of the business towards achieving its objectives, are rather more flexible, and can be adjusted to deal with problems, which may arise in attaining those objectives, or as required by the operating position of the enterprise at a particular time.

A farmer, for example, must research the market for the supplies and demands - a business can only continue to exist for as long as there is need for its products or it can create a need for them - and then decide which best sold agricultural products could be cultivated or received on his farm, considering all circumstances and local conditions. He must then decide whether he will sell in bulk, in form of retailing, or a combination of two.

Plans are the predetermined routes to the achievement of objectives, that is, they are the result of decision taken on how the objectives are to be achieved. What is called forecasting is therefore essential if management is to be able to carry out effectively its planning function.

Once the initial objectives and basic policies of an enterprise have been decided upon, the interpretation and implementation of the policies and the achievement of the objectives are the responsibilities of the management team. In business, the board of directors, top management, is involved mainly with what is called ‘strategic planning’, which is concerned primarily with deciding what the objectives and policies should be in years ahead, and such planning covers mainly the enterprise as a whole rather than individual departments or sections. Senior management is involved in ‘tactical planning’, that often entails devising and operating short-term plans, for up to a year to come. Other strata of management, including supervisors, are involved mainly in very short-term ‘operational planning’ involving the day-to-day running of departments and individual assignments.

Text 10 - business financing

Every new business requires capital. Generally that is in the form of money or the potential available money - from savings or a loan or a bank overdraft, for example - although in some cases part of the capital may be in the form of other assets (possessions on which a monetary value can be placed) such as land, buildings, stocks of raw materials or good for sale, etc.

Some expenditure may be of a ‘capital’ nature in which money will be exchanged for other assets of equal or similar value, and which are intended to be retained for some time. Such assets as real estate, plant or equipment are often called ‘fixed assets’ or ‘working assets’. The variety of such items is great and, depending on the type and size of a particular enterprise, may range from office equipment, to factory buildings and plant.

Other expenditure is referred to as ‘revenue’ one, and is incurred to enable the business to carry on the activities for which it is established, and is that which purchases materials for production and/or goods for resale. The commonly used term ‘current assets’ or ‘circulating assets’. Some current assets - such as cash in hand or at bank, investments and monies owed by short-term debtors - may also be called liquid assets because they are readily realizable and available. It should be noted that it is by the ‘turnover’ of its current assets that an enterprise makes its profits, or its losses.

---

Liabilities are any sums, measured in monetary value, which an enterprise (or ‘debtor’) owes to others (usually called ‘creditors’), that is, they are the debts of the given business. Liabilities can be classified into three groups, which are (a) capital, which is dealt with in detail below; (b) long-term liabilities which extend over lengthy periods, examples being mortgages on land and buildings, bank loans for the purchase of expensive machinery, etc.; (c) current liabilities which, as with current assets, fluctuate in form and value continually - the most common current liabilities in business are sums owed to trade creditors and bank overdrafts.

Capital income comprises the initial capital plus any additional capital invested in an enterprise, and also any long-term loans made to it, in whatever form, any proceeds from the sale of fixed assets and returns (interests) on long-term investments.

Revenue expenditure comprises all expenses which must be paid if an enterprise is to be able to carry on its normal activities, whether they be trading, manufacturing or service-providing. Such expenditure can be further divided into direct expenditure (directly related to the primary activities of the enterprise) and overhead expenditure (e.g. postage, rent, managerial salaries, etc.).

---