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Section 6 – Financing The Enterprise

1532 words - 7 pages

Introduction:
Financing and accounting is a major part of any business without proper financing it will kill your business having good accounting, is crucial to all businesses. Nike has financed their ideas from the beginning with almost nothing. Oregon natives Phil Knight and Bill Bowerman took an idea and five hundred dollars and an idea became the biggest shoemaker ever. They have athletic footwear, apparel, and accessories for a variety of sports and fitness activities. Nikes subsidiaries are Converse, which designs, markets, distributes athletic lifestyle footwear, apparel and accessories also Hurley International LLC, which designs, markets, and distribute surf and youth lifestyle footwear, and apparel. The accounting used then were just them two and this idea today they bring in enough cash flow to finance all of their ideas and internally they have their own accounting department that controls and takes care of their financials.
Nikes Financial Position:
There is only one way to describe Nikes financial position, that is strong and grew from a five hundred dollar idea to a billion dollar industry. Nike is known everywhere and its products are distributed worldwide, its geographies include North America, Western Europe, and Japan, NIKE expects to generate average annual growth at a high single digit rate for the four-year period from fiscal 2014. The Company expects North America and Western Europe to reach over $14 billion and $6 billion, respectively, by fiscal year 2017. In its developing geographies in Greater China, Central & Eastern Europe, and Emerging Markets, the Company stated it expects to grow at a low double-digit average annual growth rate. For the Company’s Emerging Markets geography, it expects to grow at a mid-teens average annual growth rate and for Greater China to return to growth, reaching an average low double-digit rate of annual growth for fiscal year 2014 through. The NIKE Brand is expected to be the largest contributor of incremental growth as the Company. (Nike 2013) During its investor meeting in New York, the Nike target of $27 billion by the end of fiscal 2015 based on growth expectations across its portfolio, which includes the NIKE Brand, Cole Haan, Converse, Hurley, Jordan Brand, NIKE Golf and Umbro. Nike expects to generate over $12 billion of cumulative free cash flow from operations through 2015. (Cendrowsk Scott 2012)
Financing Operations and Assets:
Nike believes in keeping cost effectives product and sustainability human resources is major factor in financing operation Nike sales on the open market and their first quarter earnings are in the billion. Revenues from continuing operations are up 8 percent to $7.0 billion Diluted earnings per share from continuing operations up 37 percent to $0.86Worldwide futures orders up 8 percent, 10 percent growth excluding currency changes Inventories as of August 31, 2013 up 6 percent.(Nike Corp 2013)
The three main product lines of Nike's brand - footwear,...

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