StudentShare
Contact Us
Sign In / Sign Up for FREE
Search
Go to advanced search...
Free

The Finance Director in Tesco Public Limited Company - Essay Example

Cite this document
Summary
This essay "The Finance Director in Tesco Public Limited Company" explores similarities between the Tesco finance director’s job and the finance director’s job in the other three United Kingdom companies. One similarity is the need for knowledge of accounting and finance concepts…
Download full paper File format: .doc, available for editing
GRAB THE BEST PAPER94.8% of users find it useful
The Finance Director in Tesco Public Limited Company
Read Text Preview

Extract of sample "The Finance Director in Tesco Public Limited Company"

Finance Director April 4, Introduction The finance Director is one of the top officers of the Tesco Plc Corporation (Besley, 2008). During 2005, Tesco Plc’s Finance Director was Andrew Higginson (Cullen, 2009). The finance director’s primary functions include reducing the financial risks of the company’s daily operations (Warren, 2011). The other titles of the finance director include Chief Financial Officer and Chief Financial and Operating Officer. In the United Kingdom, the term Finance Director is the more popular term used. The finance director must contribute to the attainment of established goals and objectives. Finance Director The finance director, especially Tesco Plc’s finance director, has other functions (Brealey, 2011). The other functions include setting up and spearheading the implementation of the strategically planned financial plans towards accomplishing established company goals and objectives. In addition, the finance director is fully responsible for the subordinates’ safekeeping and true and correct recording of all financial reports of the company. Correspondingly, the finance director must analyse the financial data as a tool for recommending future finance-related management and marketing strategies. The Tesco finance director reports to other top level corporation officers (Megginson, 2008). The finance directors reports to the chief executive officer. Likewise, the finance director presents the financial position of the company to the board of directors the board of directors are the investors of the company. As investors, the members of the board of directors are part owners of the corporation. The other owners of the corporation are the investors or stockholders who are not members of the board of directors. Likewise, the finance director attends meetings of the board of directors. During the attendance, the finance director presents his financial reports. The financial reports include the prior accounting period’s financial position accounts. There are other functions of the finance director, including Tesco Plc’s finance director (Melicher, 2008). The finance director monitors and manages the finance department of the company. The finance department includes the accounting department, the budget department, and the treasury department. The treasury department is in charge of safekeeping the corporation’s cash and other cash equivalent accounts. Further, the finance director contributes his share to ensuring the budget amounts hasten the accomplishment of strategic company targets and benchmarks. The finance officer contributes to the creation and implementation of viable forecast plans. The finance officer makes a time analysis between the cost of investing in approved projects and the benefits from investing in the preferred projects. For example, Tesco’s finance director (David Reid) emphasized that one of Tesco’s United Kingdom financial strategies to generate high cash inflows was to grant credit card purchases (Hensmans, 2012). The credit card purchases allowed the current and future customers of Tesco to postpone the payment of their purchases at a later date. Similarly, the credit card purchases allowed the customers to pay their accounts on installments. In fact, Tesco’s credit card purchased were approved long before one of its United Kingdom grocery chain rivals, Sainsbury Plc, granted credit card purchases to its current and future customers. On September 30, 2005, Tesco Plc’s Finance Director Andrew Higginson announced that the company’s financial analysis prodded the company to divest its investments in Taiwan. After several accounting periods of losing sales to the local Taiwan competitor, Higginson and the other officers of Tesco decided to withdraw from the meager profits generated from the Taiwan market segment. Further, Tesco’s Finance Director Higginson and the other management officers decided to finance the company’s Central European market segment expansion. The European expansion included acquiring stores previously owned by Carrefour chain of stores. Finance Director Higginson opines that Tesco’s late entry into the Taiwan market segment triggered the saturated Taiwan market segment’s lackluster demand for the new Tesco grocery chain products (Andrews, 2013). If the finance director fails to contribute to increasing the company’s revenues and profits, the finance director can be terminated or booted out of the company. Recently, there is a prevailing report that Tesco’s current finance director, Laurie McIlwee, will be submitting his resignation within less than one month from this paper’s date (Andrews, 2013). The finance director is likewise being blamed for the drop in the demand for the higher priced Tesco products. With lower United Kingdom grocery product demands, Tesco’s United Kingdom revenues are expected to continue on its declining revenue path. With the decline in the company’s prior period revenues, there is an automatic reduction in the company’s current and future net profit figures. Tesco’s unsuccessful price war battle with United Kingdom competitors like the Aldi chain of grocery stores triggered the decline in the demand for once very popular Tesco Plc Company’s grocery and other products. The finance director had to do a better share to successfully regain many of its former customers. Within the United Kingdom environment, the finance director is partly to blame for the decline in the United Kingdom market segments’ sudden shift to the lower priced grocery chain competitors’ product alternatives. The former customers shifted to the smaller lower priced grocery chain competitors (McLoughlin, 2010). One of the issues raised for the resignation of the current Tesco finance director, McIlwee, is the director’s reducing the amount of future long term loans. Instead of applying for the more appropriate £ 10 billion loan needed for expansion and higher operating funds, the finance director slashed the loan amount to the less favourable £ 6.4 billion during 2009 alone. Likewise, McIlwee unfavourably reduced necessary capital expenditures during February of the prior year, 2013. The slash led to more sluggish marketing strategies. With the sluggish strategies, the competitors were able to grab the current and future Tesco customers. The competitors’ successful takeover of the Tesco customers was done by offering grocery prices pegged at lower than the prevailing Tesco store prices. Previous to McIlwee’s being appointed as finance director, its former director Andrew Higginson was also forced to vacate his position due to Tesco revenues (Felsted, 2014). Finance Director advertisements from Other United Kingdom companies during 2014 Other companies are hiring similar finance director prospective applicants. Ethical Property Company posted an advertisement in one United Kingdom periodical, The Guardian (Anon, 2014). The Oxford job indicates the finance director is one of the company’s senior management positions. The salary of the newly hired finance director will be pegged between £50,000 and £55,000 per year. The company requires the chosen finance director to have the required prior experiences needed to exemplify in the new company’s finance director role. Likewise, the company requires the chosen finance director to be ambitious enough to help steer the company to attaining established company goals and objectives. The hired finance director must prioritise overseeing the management of the company’s scarce financial resources. Specifically, the new director must have the capacity to raise new loans and well as generate more investments to fund the company’s current business operations and future business expansions. Further, Birmingham Rep Theatre is hiring its own finance director (Anon, 2014). The finance director will be part of the company’s senior management team. The salary will be between £ 40,000 and £45,000 per year. The finance director will help plan the financial aspect of ensuring the theatre attains its goals and objectives, including the efficient and effective operations of the theatre. The hired finance director focus on the favourable maximization of its Birmingham Repertory company’s expenses as it cooperates and coordinates with other trading partners within our United Kingdom environment. Third, Prospectus Company of Devon is hiring its own Finance Director (Anon, Finance Director, 2014). The salary will be £ 50,000 per year. The job entails the company’s South West England company’s investments and expenditures in the school environment are maximised. Maximisation precipitates to higher net profits. The company’s requirements include an accounting or finance background and teamwork capability with other departments and groups within and outside the company. Comparison There are similarities between the Tesco finance director’s job and the finance director’s job in the other three United Kingdom companies. One similarity is the need for knowledge of accounting and finance concepts (Wickramashinghe, 2012). Another similarity is the need to cooperate and coordinate with other departments within the company. A third similarity is the need to contribute the company’s attaining established company goals and objectives, including reaching the benchmarked revenue, finance, investment, and profit goals. On the other hand, there are minor differences between the Tesco finance director and the finance directors of the other three companies (Black, 2011). First, the location of the Tesco Company and the three other companies are different (Moyer, 2008). Next, Tesco Company’s grocery business differs from the business or market segments of the three other companies. Third, the specific (detailed) duties of the Tesco finance director and the finance director of the three other companies differ, in terms of fund raising, fund management, and other factors. Conclusion The above discussion clearly shows the importance of the finance director’s role in the corporation. The finance director manages the finances of the corporation, especially Tesco Plc. The same director seeks loans needed for expansion and continuing business operations. The director coordinates with other management officers to ensure viable smooth operations and marketing continue to generate higher revenues and profits. Evidently, the finance directors must ensure financial strategies achieve benchmarked goals and objectives, especially within Tesco Plc’s United Kingdom grocery environment. ‘ References: Andrews, T. 2013. Marketing Management, Routledge Press, London. Anon. 2014, April 2. Finance Director, The Guardian. Anon. 2014, April 1. Finance Director, The Guardian. Anon. 2014, March 28. Finance Director Job, The Guardian. Besley, S. 2008. Essentials of Managerial Finance, Cengage Learning, London. Black, G. 2011. Operations Management. Prentice Hall Press, London. Brealey, R. 2011. Principles of Corporate Finance, McGraw Hill Press, London. Cullen, J. 2009. International Business Strategy, Routledge, London. Felsted, A. 2014, April 3. Tescos Finance Director to Leave, Financial Times. Hensmans, M. 2012. Strategic Transformation: Changing While Winning, Palgrave MacMillan, London. McLoughlin, D. 2010. Strategic Market Management, J. Wiley & Sons, London. Megginson, W. 2008. Introduction to Corporate Finance, Cengage Learning, London. Melicher, R. 2008. Introduction to Finance, Cengage Learning, London. Moyer, R. 2008. Contemporary Financial Management, Cengage Learning, London. Warren, C. 2011. Financial Reporting. Cengage Learning, London. Wickramashinghe, D. 2012. Managerial Accounting, Routledge Press, London. Read More
Cite this document
  • APA
  • MLA
  • CHICAGO
(“Evaluate the role of finance director in an organisation of your Essay”, n.d.)
Evaluate the role of finance director in an organisation of your Essay. Retrieved from https://studentshare.org/finance-accounting/1637432-evaluate-the-role-of-finance-director-in-an-organisation-of-your-choice
(Evaluate the Role of Finance Director in an Organisation of Your Essay)
Evaluate the Role of Finance Director in an Organisation of Your Essay. https://studentshare.org/finance-accounting/1637432-evaluate-the-role-of-finance-director-in-an-organisation-of-your-choice.
“Evaluate the Role of Finance Director in an Organisation of Your Essay”, n.d. https://studentshare.org/finance-accounting/1637432-evaluate-the-role-of-finance-director-in-an-organisation-of-your-choice.
  • Cited: 1 times

CHECK THESE SAMPLES OF The Finance Director in Tesco Public Limited Company

An Analytical Report of Tesco PLC

The paper therefore focuses on Tesco PLC, a UK based international grocery company.... Additionally, secondary sources like books and journals are used to provide a deep insight into the company.... The paper therefore focuses on Tesco PLC, a UK based international grocery company.... Additionally, secondary sources like books and journals are used to provide a deep insight into the company.... However, where necessary, the research will cover aspects of Tesco's international operations to give a better insight into trends and ideas of the company....
11 Pages (2750 words) Essay

Tesco Business

Originally, it was a food company but expanded its scope of service to electronics, clothing, financial services, telecoms, and internet services.... This paper ''tesco Business'' tells that tesco, the biggest supermarket in the United Kingdom dominates the British retail market with both the market share and global sales.... Core UK business, retailing services, non-food business, and international presence are the four key parts that tesco's strategy focuses on....
9 Pages (2250 words) Essay

Share Price Report

On the other hand, Morrison (Wm) Supermarket is the public limited company that operates in retail industry with its headquarters in the United Kingdom.... Tesco supermarket operates under the parent Tesco private limited company that operates supermarkets and 5 hypermarkets.... The company reported revenue of 3.... In above connection, Tesco company had shown great improvements with respect to its shares prices.... Additionally, the company offers variety of products such; food stuffs, wines, health products, spirits, furnitures, entertainment items pharmacy items to mention just but a few....
4 Pages (1000 words) Essay

Financial Statement Analysis of Tesco as a Limited Company

This essay "Financial Statement Analysis of Tesco as a limited company" seeks to evaluate the financial statements of Tesco for the past four years as to its financial performance in its income statement, liquidity, operating cycle, and management of working capital, and its investment ratios.... The company's ratios will be compared to its competitors in the industry using the averages available to enhance analysis.... There is a need to compare the company to its competitors measure whether the company is performing well in the industry....
9 Pages (2250 words) Essay

Business Development

An analysis of Tesco company and Alton Towers Resort proves essential in assessing business developments.... The first focus relates to Tesco company that started as a groceries shop in East London in 1919.... After being registered as a private company in 1932, new developments followed after floating the company's stocks in the stock market in 1947 (Pinto, 2012, pg.... The company continued with its expansionary zeal by buying competitors shops....
6 Pages (1500 words) Coursework

Strategic Decision of Tesco

With 2,700 ATMs located in tesco stores, the retail giant is well equipped to face off competition from rivals who might not have the same advantage of offering combined services of retailing and banking to the customer at one single location.... Tesco's initial move into the market of personal finance was limited to credit cards, vehicle insurance, and related retail banking.... In the paper 'Strategic Decision of tesco' the author tries to answer the question: Is tesco's intention to offer consumers basic bank accounts a strategic decision or an opportunistic one?...
20 Pages (5000 words) Research Paper

Choice of Appropriate Business Financing for Tesco

This is because finance enables the company to buy and sell stocks of various goods as needed.... Lack of adequate finances limits the scope of operations and can impede the growth prospects of the company.... The company has continued to expand since it was established.... The company has continued to make profits, especially for the last twelve years.... The company's mission is 'to create value for its customer, to earn customer loyalty'....
9 Pages (2250 words) Case Study

Pros and Cons of Financial Reporting Regulation

Necessarily there is the cost of regulation brought by the need to have increased filing and making available to the public information about the business.... In the same way that human beings need to have laws to maintain order, the business community needs some guidelines in the way they make their responsibilities discharged to the public.... public Corporations do have their stocks listed and sold at the capital market and they are required to file financial statements with the regulatory agencies for the purpose of disclosing to the investing public their financial operation....
16 Pages (4000 words) Coursework
sponsored ads
We use cookies to create the best experience for you. Keep on browsing if you are OK with that, or find out how to manage cookies.
Contact Us