Corporate Fundraising Essay Example | Topics and Well Written Essays - 1750 words - 1

Corporate Fundraising - Essay Example The Relevant Laws Green Coffee Company Limited a Fair Trade and Rainforest Alliance certified company, thus it has earned a significant extent of goodwill over the years (Rainforest Alliance 2013). In this regard, issue offer (sec 706), sale offer (sec 707) of securities need to be disclosed. In case of right issue, disclosures are not necessary (sec 708AA), apart from the disclosures on sale offer under section 707, there are certain sale offer which do not need discloses (sec 708A). Corporations Act 2001 prohibits the organisation which raises funds to execute its endeavour without the proper disclosures of the documents (Section 727) (AustLII n.d.). If an organisation offers 20 issues in 1 year then the publicity and the advertisements for issues will be restricted fir them. Prospectus issued by the company, in this case Green Coffee Company Ltd, will be a very important document relating to investments. Prospectus protects the investors by educating them regarding the investment proposals. Australian Accounting Standards Board continuously closely observes the work of the capital markets and makes amendments on the rules prevailing in the countries whenever necessary. On the other hand, Australian Securities and Investments Commission (ASIC) works as a legislator and regulator. With regard to fundraising, Green Coffee Company Ltd needs to disclose various kinds of documents (sec 705). In case of full disclosure made in prospectus, a company needs to include the terms like content (sec710, sec 711, sec 713), procedure (sec 717), liability (sec 728 and sec 729) and defences (sec 731, sec 733); sort form of prospectus only needs to disclose its content (sec 712) (Thomson Playford 2006). Certain other kind of documents includes profile statement (sec 721) and offer information statement (sec 709). Details are given in the website of Commonwealth Consolidated Acts namely â€Å"www.austlii.edu.au†. Disclosures are not necessary when $10 million (includes t he received amount at past) or less is the targeted amount (ASIC 2012). Application of the Law Green Coffee Company Ltd. desires to expand its business in Vietnam. Investment in foreign country involves a substantial proportion of capital expenditure. Capital formation of an organisation includes debt financing and equity financing, which constitute capital structures of the firm. An optimum capital structure provides the firm better results. It is a registered company, for this reason it has to carry out its fundraising activities in consideration with the Chapter 6D of the Corporations Act 2001 (Cth). As it is a public limited company so it has the opportunities to raise funds from the country which helps this organisation in terms of its expansion program. Before the distribution of the prospectus in the market, Green Coffee Company Ltd. has to ensure that it is providing its financial data which are correct from all the ends. The company also needs to evaluate the future earning potentials of the firm in respect of Vietnam. Vietnam’s guidance for the operations needs to be scrutinised. Forecasting techniques for cash inflows and outflows has to be compared. Owing to the reason that Chapter 6D deals with the fundraising activities, thus at the time the preparation of prospectus certain aspects need to be take into