Corporate Finance Company Profile of PepsiCo Essay

Corporate Finance Company Profile of PepsiCo - Essay Example Pepsi is working on heightened regulatory and market scrutiny of corporate governance practices in order to communicate and represent the organization in a manner that pleases the shareholders, utilizing resources in a new and evolving compliance environment. Management should be eyeing the macro factors like Government’s policies, competition and tax rates where they operate a business because local, national or international jurisdictions and new or changing regulations might create hurdle in their way. Company’s strong point is that they have sharpened their focus on sales, service and customer orientation and are eagerly looking forward to improving its product and service quality. In order to retain its market share in every possible manner, the management is keen on maintaining the performance momentum and competitive advantage in the marketplace. There has been a positive increment in cash and cash equivalent in the year 2008 in comparison with the year 2007 and 2006. The sole reason behind this is the decrease in investment in the securities .Moreover, holding of the short-term borrowing makes an impression on cash and cash equivalents. Pepsi utilizes its reserve or liquid cash in a profitable manner because Pepsi makes an investment in securities, which in the end makes a profit for the company. The utilization of cash for investment purposes also shows in the current and quick ratio, and is a healthy sign for the company’s future prospect. In the year 2008 and 2007 no significant moment is observed in fixed assets of the Pepsi. Pepsi has applied proper inventory management techniques and policies. Due to the high demand of the company product, less percentage of inventories is in hand, and the inventory turnover is also evidence of proper inventory system adopted by the Pepsi throughout these three years (Myers, Bre aley and Marcus, 2001). Pepsi is primarily financing their activities through debt.