【文章內(nèi)容簡介】 f defective products – USA vs. Britain: case law difference ? Public scrutiny – USA vs. Britain: Statutory law difference ? Legal expenses (plaintiff or defendant) –USA vs. Britain: law administration difference Taxation ? ? Direct tax (ine) – Corporate – Personal ? Indirect tax – VAT or Business tax – Excise tax – Property tax – Stamp duty – Tariff International Taxation ? ? Tax jurisdiction (residential vs. territorial) ? Withholding tax (dividend, royalty interest) ? Double taxation amp。 tax credit (35% = 10% + 25%) ? Transfer Pricing (vs. arm’s length: no relationship) ? Branch vs. Subsidiary (tax to home country) Foreign Tax Credit Accounting Standard (IAS vs. GAAP) ? ? Revenue recognition (Critical path) – Accrual method amp。 Front end loading (premature recognition) ? Inventory valuation – FIFO, LIFO, HIFO ? Amortization amp。 depreciation – Straight line vs. Double decline balance: – Length of estimated life ? Asset capitalization amp。 Rear end loading: – underestimate of current period expense: (WorldCom) ? Asset impairment amp。 revaluation ? Offbalance sheet debt – Unconsolidated debt of subsidiaries (Enron) Accounting Standard ? Buckley, A. 2022: Multinational Finance, Prentice Hall, p49 Dispute Settlement ? ?Which country’s law applies ? In which country the issue be resolved ? Which technique: litigation, arbitration.. ? How will the settlement be enforced Cultural System ? ? Value amp。 Norm – Belief of being good amp。 right ? Reflected in amp。 reenforced by – Behavior (pattern of response) amp。 Ritual (formal amp。 repetitive) – Information amp。 media of information – Artifacts (objects) – Institute (stratification amp。 mobility) Value amp。 Norm ? Virtue – True (honest) – Kind (golden rule) – Beautiful (right proportion) ? 4 Cardinal virtue – 仁 (ren) 義 (yi) 禮 (li) 智(zhi), 信 (xin) Differences in Cultural Systems? ? Hofstede 5 orientations – Power orientation (distance) – Uncertainty orientation – Social orientation (individualism) – Goal orientation (material possession) – Time orientation (short term gain) ? Eastern vs. Western – Patience Vs. Action – Harmony Vs. Freedom – Hierarchy Vs. Equality Market Potential ? ? GDP . ? The problems of –Commercialization of economic activities – Ine distribution – Market exchange rate Market Potential ? ? Trade Statistics (UN Trade Statistics Year Book) ? Market Index (Cross Border Monitor) ? Proxy ? Comparable Segment UN trade Statistics ? Market Index ? ● Cross Border Monitor (Business International) EIU: 40 indicators Pop: population, upop: urban population。 pc$: private consumption KWH: electricity。 stl: steel consumption cem: cement production Tele: telephone in use cars in use TV in use iiiiiiiii TVc a rte lecems tlK WHpcp o p up o p TVc a rte lecems tlK WHpcp o p up o pS iz eM a r k e t ???????? ????????? $2 $2Proxy ? ? Tire purchase = x Car registration ? Satellite dish, imported car in street for other luxury goods ? Refrigerators = marriage+ divorce+ house start Comparable Ine Segment ? PPP Exchange rate Big Mac Index 1S$ = 25 Baht S$5000 = 125,000 Baht 1 big Mac = 1 big Mac 5S$ = 50 Baht 1S$ = 10 Baht S$5000 = 50,000 Baht Big Mac Index PPP Exchange Rate Resources ? ? Availability, Cost, Reliability ? Infrastructure, Human, Capital, Raw Materials, Intermediate Goods, Machinery amp。 Equipment, Geographic proximity Economic Risk ? Internal Balance – Recession or inflation – Demand misalignment or structural problem ? External Balance – BOP Balance (trade amp。 capital) – Exchange rate Economic Risk ? ? Foreign debt default – Moratorium – debt service ratio (interest + principal due)/exports ? Foreign exchange risk ? Interest rate risk ? Inflation risk Internal amp。 External Balance Internal amp。 External Balance Political Risk ? ? Change in leader or policies ? Civil disorder ? Animosity between host amp。 other countries – Sanction (restraint against merce: technology, tariff, loan etc.) – Embargo (prehensive sanction) ? Ownership risk ? Operation risk ? Transfer risk Political Risk Perception Ownership Risk In 1960’s to 1980’s Analysis Of Political Risk Managing Political Risk ? ? Integral part of the host country – Intensive use of local resource – Contribution – Joint venture ? Insurance coverage Legal Risk ? ? Uncertainty of law amp。 law enforcement ? Extraterritoriality (outside boarders) – Burma sanction – FCBA ? Inparable legal requirement – Property right protection – Product safety amp。 liability – Environment amp。 workplace standard – Corruption (Foreign Corrupt Business Act) Porter’s Diamond ? Management Ideology Industrial Structure Supporting Industry (ponent amp。 tool) Demand Condition (size amp。 sophistication) Factor Condition (natural amp。 advanced) Government Chance Eclectic Theory of Entry Mode ? –Ownership Advantage ?Competitive advantage over the rivals – Location Advantage ?Why host country – Internalization Advantage ?In source or out source Location Advantage ? ? Low input cost ? Market ? R amp。 D facilities ? Logistic ? Administration ? Economic, political, legal amp。 cultural system Opportunity Risk Grid ? Country Variables Weight A B C D Acceptable/Unacceptable Allow 100% ownership U A A A Opportunity (H: preferable) Size of investment needed 05 4 3 3 Direct cost 03 3 1 2 Tax rate 02 2 1 2 Market size (now) 04 3 2 4 Market size 310 years 02 2 1 2 Risk (H: Preferable) Loss making 04 4 2 1 Exchange rate 03