http://www.financialpost.com/trading_desk/financials/story.html?id=1171778
Summary:
Canada’s fourth largest bank, BMO Bank of Montréal,purchased the world’s largest insurance company – AIG’s Canadian Life Insurance Unit. It acquired the company with an all-cash transaction of $375 million CAD. AIG was required to pay back the loans from the U.S federal government with an amount of $60 billion US dollars. BMO saw the purchase as a source to expand, strengthen the business’ financial plans, and increase client relationships. Also, the business deal will certainly benefit BMO’s revenue by opening the doors to a variety of customers and enhancing the bank’s earnings. Without a doubt, the BMO has strategically purchased AIG Life of Canada at a perfect timing with a fairly low cost.
Connection:
Chapter 4 focuses highly on Revenue Recognition with the GAAP code and criteria. Businesses strive to keep their company from bankruptcy by continually earning revenue throughout their accounting cycle and recording it into the financial statements. Only the businesses with new and fresh strategies are able to successfully continue their business without being afraid of closing down. Similar to BMO’s earnings with additional accounts and customers, they must recognize the revenue they encounter by verifying it onto the financial statements. Also, the purchase of AIG Life of Canada clarifies the Return on Investment Ratio (ROI) which declares the Performance Measurement of the business.
Reflection:
I think BMO took a mountain load off AIG’s shoulders as they acquired the company with an all-cash transaction. It is fairly beneficial to BMO’s new line of business for financial plans and increasing customers. As a matter of fact, I think BMO made a smart move when they decided to buy AIG Life of Canada. This way, the bank will be able to strengthen their financial position and achieve access to many supplementary customers. Also, AIG couldn’t maintain their expenses at low costs with high revenue which indicates their unsuccessful business strategies. It was impossible for AIG to survive without the help of BMO’s cash flowing into the company.
Monday, March 1, 2010
Chapter 3 !!!!
http://www.canada.com/vancouversun/news/business/story.html?id=6d86864a-1991-4ebe-b2de-0cf76d741760
Summary:
This article is about most of the small business owners in B.C are optimistic for the falling economic. Recently, TD bank got a Small Business Survey which found out the mainly concerns to manage growth was maintaining cash flowing. TD bank also replies their survey that “they are a bright light in these darker economic times.” They are optimistic about small business owners are able to grow their business and take steps to effectively manage their growth. This survey is provided an important strategically plan for small businesses. For example, small business owners have better raise enough capital before starting or diversify services.
Connection:
The connection between the article and the text book are Chart of accounts and the accounting cycle. All the businesses need to provide chart of accounts that all the information recorded in the accounting system are generally summarized. The business required to follow the system of accounting cycle which is recording and reporting of events in the accounting system. If businesses follow those steps, it’s easy to read or analyze the statement. Owners or the authorities can easily to figure out how much cash flowing they have now. It’s very important to know this information because the business must have enough capital before they have new services or production in the falling economy.
Reflection:
In the article,it talks a bout how small business owners are so optimistic for the falling economics. I can understand that , because they are only a small business; they cannot handle anything big happen to them.
Summary:
This article is about most of the small business owners in B.C are optimistic for the falling economic. Recently, TD bank got a Small Business Survey which found out the mainly concerns to manage growth was maintaining cash flowing. TD bank also replies their survey that “they are a bright light in these darker economic times.” They are optimistic about small business owners are able to grow their business and take steps to effectively manage their growth. This survey is provided an important strategically plan for small businesses. For example, small business owners have better raise enough capital before starting or diversify services.
Connection:
The connection between the article and the text book are Chart of accounts and the accounting cycle. All the businesses need to provide chart of accounts that all the information recorded in the accounting system are generally summarized. The business required to follow the system of accounting cycle which is recording and reporting of events in the accounting system. If businesses follow those steps, it’s easy to read or analyze the statement. Owners or the authorities can easily to figure out how much cash flowing they have now. It’s very important to know this information because the business must have enough capital before they have new services or production in the falling economy.
Reflection:
In the article,it talks a bout how small business owners are so optimistic for the falling economics. I can understand that , because they are only a small business; they cannot handle anything big happen to them.
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