Introduction To Business Environment Essay - 918 words

Introduction to Business Environment Assignment 1 1) PLC is the Public Limited Company. Raise capital by selling shares and debentures to the public. Needs two directors and two shareholders. A member can appoint more than one proxy who can vote but can not address meetings. The secretary must be qualified and posses the requisite knowledge and experience. Public scrutiny over accounts aids performance and efficiency. Large market for shares.


No restriction on share transfers on stock exchange, but must keep track of who has shares. Encourages investment into company by share ownership by paying dividends. Can be exempt from the statutory requirement to have its year end accounts audited. Has legal requirement concerning allotted share capital must be equal or greater than fifty thousand pounds. Can not exercise its borrowing powers or enter business transactions until the registrar has granted it a section 117 certificate. High degree of legislation, rule and formalities it must conform to, e.g. directors retiring at 70 years of age, minimum of two directors, voting for directors individually at a general meeting, share allotment. Must publish its accounts in full.


Can not give financial assistance to a person to enable him to purchase the companys shares. In order to outline the four factors that would affect share price of Tesco plc, we should look at its performance in the previous years. Having in 2001 posted record profits of some 1bln pounds sterling, Tesco saw profits at the half-way stage hit 417mln pounds sterling, an increase of 14% compared to the same period previous year. Turnover was also up, recorded at 11.5bln pounds sterling compared to 10.1bln pounds sterling for the 24 weeks. In Tesco's core market, the UK, sales grew by 10% to 9.8bln pounds sterling compared to 8.9bln pounds sterling in 2001, of which 7.0% came from existing stores and 3.0% from net new stores. Existing store growth was driven by strong volumes of 6.9%. UK operating profit was 12.1% higher at 501mln pounds sterling up from 447mln pounds sterling.


Tesco, along with other mega-businesses, have in the past come under criticism, especially having posted record profits while the UK's farmers were struggling with foot-and-mouth disease. However, the UK firm says it compared prices every week on over 66% of its total sales, which revealed that its prices are 12.5% cheaper than they were five years ago. (1) Based on those facts, I can suggest the four factors that could affect the share price of Tesco plc. Further expansion is one of them, and probably the most important. The more stores Tesco has, the higher the share price would raise. The thing here is not only in maximiz ...................................................................................................................................................................................................................................................................................................................................................................

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Essay Tags: tesco, interest rate, business environment, pound, sterling

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