Papers Category:Securities Finance Papers
- Futures Market Papers
Post Time:2012-5-4 11:21:00
[Abstract] long-term equity investments in foreign investment in the enterprise occupies a pivotal position because of its long-term holders of the shares of the investment unit for the purpose intended to influence the risk for corporate long-term equity investment is facing and the presence of problems, propose the establishment of a comprehensive risk management system, improve the corporate governance structure, rationalization of internal organizational structure, and improve internal control and build process of the investment risk prevention mechanisms, to effectively prevent the risk of equity investment.
[Paper] long-term equity investments, corporate governance structure, internal controls, organizational structure
One, the risks faced by the enterprise long-term equity investment
Long-term equity investment is facing the risk can be divided into investment decision-making risk, investment risk of operational management and liquidation of the investment risk in particular:
(A risk of investment decisions Project selection risk is the risk of the investment unit in which the industry and the environment, as well as its own technology and market risk. (2) the risk of the project demonstration.
Investment due diligence and feasibility of the project risk. Decision-making process risk is the risk of the program is imperfect, and program execution lax.
(Two investment operations manage risk A risk of ownership structure, including: shareholders the option of risks, corporate governance risk, the risk of an investment agreement. .
Commissioned agents operating in the risk of moral hazard. Phase separation of ownership and management of the enterprise would have a principal-agent relationship principal-agent system goal of the owners and operators of inconsistency, the drawbacks of asymmetric information, agents may use their own advantages, the pursuit of their own to maximize the benefits arising from moral hazard. (3) investors transfer risk.
Main business risk is the existence of the invested enterprise, financial risk, internal risk passed to investors through equity relationships.
Group of project responsibilities and assignment management risk on the one hand, investors selected project liability groups or individuals, responsible for the management of investment projects, on the other hand, also accredited to the investors the directors, supervisors, deputy general manager and other senior management responsibility group and the expatriate's own knowledge, capacity constraints or a strong sense of responsibility, there is a risk management process. Information disclosure risk.
Investment management not in strict accordance with the Investment Agreement in respect of information disclosure requirements, deliberately delayed the timely reporting of financial and material business information, secret operations, provide filtered outside investors do not even false information, so that investment in the possession of information has a lot of one-sided and incomplete, so that the investor is in serious information disadvantage, will seriously affect the management of the investment side.
(C) investment in clean-up risk
From the risk of external invested enterprises, such as interest rate risk, inflation risk, policy, legal risk, interest rate risk is to changes in interest rates lead to changes in the rate of return on investment, and thus have an impact on investors' income. The risk of inflation is rising prices , the purchasing power of money fell to investors the risks of policy and legal risk of the sudden change in policy made by the government to guide economic work, or the introduction of new laws and regulations, to produce lethal effects of the business. From invested enterprises within the risk.
Invested enterprises within the technology risk, management risk, moral risk of transfer of risk to the investment side exit. Withdrawal of investment timing and manner of selection risk.
Two, the problems of long-term equity investment
Long-term equity investments in various stages of the business processes there are some typical problems, these problems are rooted in the investment risk, and ultimately lead to investment losses. Specifically, the current common problems following.
(An investment decision-making stage 1 more long-term equity investment blindness, lack of strategic planning.
To enhance long-term equity investment to a strategic level, the investment process is full of blindness. Equity due diligence is not sufficient, a mere formality.
Many companies commissioned external intermediaries to conduct due diligence, some intermediaries as investment medium for their own interests, they may try to contribute to investment, allowing information to be white washed Some companies independent due diligence, the usual practice is that the organization of several departments to the target company to inspect, but often just the internal assignment of staff, lack of external expert consultants, the process a mere formality, skim the surface, the lack of targeted, sometimes the information provided by the target company unilaterally as inspection results, it will surely make the survey results inaccurate. 3 report on the feasibility and investment programs produced imperfect, too much emphasis on the contribution link.
Preliminary investigation is not sufficient, the latter part of the feasibility study, the formulation of investment programs will be imperfect, the risk is that the causal chain of interlocking In addition, feasibility studies need to use scientific methods of financial analysis, some department or officer is the easy way, hastily cope. High-level decision-makers decision-making mistakes.
Corporate senior leadership will and risk appetite will investment decision-making a significant impact on some decision-makers become dizzy or decision-making is manipulated by a small number of people, the lack of collective scientific decision-making, or superior The department in charge of intervention will lead to policy mistakes, which led to investment losses.
(Two in the Investment Management of stage
A project implementation of the lack of risk control, just to find a template and the other party entered into an agreement, or signed the draft agreement and articles of association in accordance with each other, not according to their own long-term equity investments targeted risk prevention.
The internal control system is not perfect, comprehensive investment management system is not established, during the long-term equity investments, failed to set up a clear responsibility of the project team, resulting in the vacuum of project management. Expatriate management is in chaos.
Number of enterprises in investment or expatriate managers do not attach importance to the target company, any of its independent management to develop freely and to be a problem, we know the investment vanish into thin air. On the other hand, sent to the directors and other senior management as the maintenance of interests of investors did not play a communication role of investment in both. even worse is that some expatriates in the environment, lack of supervision hollowed out with the investment company's internal staff collusion to invest in the company's assets, and ultimately hurt the investors.
4 project tracking the lack of evaluation and statistical analysis links corporate evaluation aspects of the lack of investment projects, no corresponding departments of the statistical analysis of the performance, leading to the investor is unable to promote the useful experience, unable to terminate the poor project. Turn affixed to the free paper download center http://eng.hi138.com
(in investment in clean-up phase
(1) No pre-set investment liquidation trigger point, there is no contingency plan for major events, in the event of a major event that has prompted investors to exit, often passive open the exit mechanism, struggling to cope.
Did not set up a special investment in clean-up team, did not set the exit target, often passive Take all the way to lose the initiative not only exit the increase in risk, but also so that post can not be rewards and punishments, is not conducive to our experience . Withdrawal of investment timing and manner of selection mistakes, so that the exit costs and investment losses, greatly increased.
Third, the establishment of a comprehensive long-term equity investment risk management system
Comprehensive risk management system is to fully implement the idea of risk management to the risk prevention process throughout the enterprise level build system framework, and corporate governance structure, the internal organizational structure, internal control framework of which are covered.
(A perfect corporate governance structure
(1 in the pre-investment and investment decision-making stage, the focus is to establish the institutional framework and its normal operation to investment decisions into the framework of norms.
(2 stage of Investment Management and investment in clean-up stage, with emphasis on dynamic management of major events, to strengthen the long-term equity investment process, and ensure that the exit channel flow.
(Two to establish a rational internal organizational structure
Our internal organizational structure of most of the functions of the tower structure from the Board to the general manager, then consists of the functional departments of the enterprises, long-term equity investment, not just corporate executives take decision-making, the project department to run to perform so simple, he often requires the coordination of various departments at all levels, is a systematic project to break the rigid organizational structure, structural design, business processes can be based on long-term equity investment to the existing functions of the departments integrated into several major systems, flexible call. Such as corporate decision-making and planning departments to integrate into the equity investment decision-making system, the Ministry of Finance, Audit Department and integrated into the equity accounting supervision system.
(C) a sound internal control system
1 sound internal control system, the formation of the network of internal control, timely detection and effective control of investment risk, including incompatible positions separate system of authorization and approval system, investment system of accountability.
(2) improve the internal accounting controls, which is the most important of the internal control processes throughout the long-term equity investment business has always been the key means of control.
(D long-term equity investment business process risk prevention
An investment decision-making risk prevention
Including effective project selection and adequate due diligence, feasibility study of the scientific, rigorous project review, the science of leadership, transparent decision-making.
Investment Operations Management Risk Prevention
Including the careful negotiations and signed an agreement to develop the assignment of directors, supervisors and senior management personnel management system, the implementation of the project responsibility to the whole process of management of the investment company in a timely manner to carry out investment projects in group evaluation.
Liquidation of the investment risk prevention
The key to long-term equity investment settlement risk prevention is to establish and improve the equity investment exit mechanism, this is not only just in case, to prepare for the inevitable requirements from time to time, more investment to the inherent need to constantly optimize. Including setting the trigger point of exit of equity investments, set a reasonable equity investment out of the goal, set up a sound equity investment in clean-up program, the implementation of strict monitoring, good summary and review work on the disposal of equity investment activities.
Fourth, the Conclusion
The risks faced by the enterprise long-term equity investment is an objective reality, and as a source of investment losses, we can not get rid of them, can only be prevented effectively reduce investment losses, it must be comprehensive and targeted problem-solving, risk prevention. want to achieve all this, the most fundamental way is to establish a comprehensive risk management system, to build from the basic level of system protection, preventive measures. Share in the free paper download center http://eng.hi138.com