Question 02 Is it wiser to manage company debt from consultants or outsiders; or
ID: 2658421 • Letter: Q
Question
Question 02 Is it wiser to manage company debt from consultants or outsiders; or to manage it using internal resources like creating separate debt management department? Critically suggest while using appropriate illustrations. (10 marks) Question 03 Controlling cash, more than any assets, requires strict adherence to internal control procedures". a. Substantiate the above statement with the help of practical examples. (7 Marks) It is important to hold money for many reasons, State and explain the motives for (3 Marks) holding money Marking will be considered for proper representation and referencingExplanation / Answer
Analysis
company can require consultancy in any form be it internal or external. But to choose an option from both of the forms of consultancy, management needs to analyse the advantage and disadvantage of both the option.
Company can go for the external consultancy if the specific expertise is required for any new project or company go for the external consultancy if internal expertise is not their.
Company can go for the internal consultancy since internal people know the company well and its culture. It becomes cost efficient also for the company.
Hence whether to go for the external consultancy or not, company has to decide first that whether any specific expertise or specific human resource required than it will be easy for the company to go for external consultancy.
Hence, both consultancy are wiser, but company has to decide whether it has good finance team with expert knowledge which can manage the debt properly or if such debt management require the specific expertise and more specific professional like CFA, CA, FRM holder to manage it.