Week 6 Analysis

Week 6 Analysis - operating and managerial policies of the...

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The profits of a company can either be reinvested in the business or paid to its shareholders as a dividend. The frequency of these varies by country. In the United States, dividends of publicly traded companies are usually declared quarterly by the board of directors. In the United States, a decision regarding the amount and frequency of dividends is solely at the discretion of the board of directors. Shareholders are explicitly forbidden from introducing shareholder resolutions involving specific amounts of dividends (SEC Form 8-A [3]). A company’s Board of Directors must approve dividends each time they are paid. There are four important dates to remember regarding dividends, such as Declaration date , Ex-dividend date , Record date and Payment date . Closely held corporations are those in which a small group of shareholders control the
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Unformatted text preview: operating and managerial policies of the firm. More than 90 percent of all businesses in the United States are closely held. These firms differ from most publicly held companies in which ownership is widely disbursed and professional managers administer the firm. Most of all closely held firms are also family-owned businesses. Family businesses may be defined as those companies where the link between the family and the business has a mutual influence on company policy and on the interests and objectives of the family. Families control the operating policies at many large, publicly traded companies. In many of these firms, families remain dominant by holding senior management positions, seats on the board of directors, and preferential voting privileges even though their shareholdings are significantly less than 50 percent....
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