Global market conditions are ripe for M&A — cash continues to
accumulate on corporate balance sheets, valuations are more reasonable, and private equity firms are looking at a backlog of exits.
But the problem of rapidly growing cash
balances on corporate balance sheets is well documented, with many corporates having publicly communicated ROIC [return on invested capital] targets.
With cash
on corporate balances sheets at high levels and dividend - payout ratios at their lowest levels since the start of the 20th century, there's good reason these types of companies make a good investment.
The fate of pension plans and companies are more intertwined than ever, according to Mercer, as new accounting rules require that changes to the value of equities and the yields on bonds be
reflected on corporate balance sheets.
A green future will also build on full - cost accounting in which a company's «hidden» expenses like pollution and resource depletion aren't foisted onto taxpayers but paid
for on corporate balance sheets.
By building new infrastructure and enabling investment in new development projects in Alberta, resources get converted to reserves, which will greatly increase the asset
values on the corporate balance sheets and ensure eventual development.
In essence, rent payments would go from being recognized as an operating expense, which doesn't
appear on a corporate balance sheet, to a capital expense, which does, thereby cutting into profits.
Since space needs are the second most costly expense
item on the corporate balance sheet after personnel, companies have been looking not only to find better ways to use office space, but also to save money while doing it.
A stock buyback is basically a secondary offering in reverse — instead of selling new shares of stock to the public to put more cash
on the corporate balance sheet, a cash - rich company expends some of its own funds on buying shares of stock from the public.
«These uncertainties will be outweighed by the record levels of cash
on corporate balance sheets and private equity dry powder spend, combined with readily available debt financing and growing risk appetite.