Running head: INTERNATIONAL BUSINESS

Global Financial Management SLP 3

September 3, 2012

INTERNATIONAL BUSINESS

The international financial management in Shell represents the system of the economic decisions arising during the realization of the financial management under the conditions of the internationalization of the economic activity of Shell. The companys commercial activity will bring more profit in the international market (directly or indirectly) than in the national market. It is an obligatory condition for the expediency of private business on the international scene. Except the general financial tasks, the international financial manager has to deal with absolutely specific goals, which they solve regarding international relations. The following points include: 1. the assessment of the countrys positioning on the international market, the analysis of the state of the balance of payment; 2. the planning of the financial operations from the point of view of the use of different currencies in the international payments; 3. 4. the crediting of the export activity; the international budgeting of the capital, the motivation of foreign direct and portfolio investments; 5. the operations with eurocurrency, eurocredit and eurobonds market.

The synthesis of the tasks solved by the financial manager and the specific tasks listed above forms the sector of the Shells international management. It includes two disciplines: financial management and business activity in the international economic relations (international trade, foreign investments, and international credit). The financial management connected with the foreign economic activity of Shell is controlled by the condition of its assets in foreign currency and management of all types of currency risks. It is necessary to note that the risk factor role is particularly pivotal in the international activity of Shell.

INTERNATIONAL BUSINESS

The financial manager of Shell should search for effective financial decisions proceeding from the principle of optimum. They have the following range of financial tasks, formulation of their decisions, and control of their fulfillment. The main task of the financial manager consists in the assessment of short-term and long-term currency assets and the obligations of the company through the prism of time and space of the international market. Responsibilities of Finance Manager: to keep update of significant environmental changes; to understand and analyze the complex interrelationships between relevant environmental variables and corporate responses; to adapt the finance function to significant changes in firms own strategic posture; to take stride past failures and mistakes to minimize their adverse impact (Role of International Finance Manager: 2012). The work of a financial manager includes not only the world of assets, passives, postings and balances. A true professional has to be aware of everything that concerns the organizations activity in which they work, to be interested in economy, policy, and to trace changes in the legislation and to constantly increase their own qualification. Thus, an international financial manager is a person who plans future cash flows; estimates liquidity and international investment appeal of Shell; analyzes the condition of the financial currency markets and follows the development of stock exchanges. The functional duties of the Shells international financial manager are: - tax and management accounting; - drawing up of accounting policies of Shell; - interaction with the supervising organizations; - investigation of the international market for the company.

INTERNATIONAL BUSINESS Thus, the financial manager should consider the following aspects:

1. The use of what currency at the moment and in this market is the most effective from the point of view of the risk of losses which were not connected with a production activity? 2. Which conditions of short-term crediting can be sufficient while the implementation of a certain commercial plan or a stage of Shells business activity? 3. What is the optimal portfolio of foreign-currency assets?

INTERNATIONAL BUSINESS References

Donovan, J. (2008). Shell International Finance Sold Largest Deal of the Day on Bond Market. Royal Dutch Shell Plc. Com. Available at:

http://royaldutchshellplc.com/2008/12/09/shell-international-finance-sold-largestdeal-of-the-day-on-bond-market/ Role of International Finance Manager. (2012). www.scribd.com.