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"The goal of a firm depend in it financial stand" this statement could be critically elaborated as follow:

Basically, Financial metrics have long been the standard for assessing a firm’s performance.  In the last ten years, the balanced scorecard (BSC) has become one of the most effective management instruments for implementing and monitoring strategy execution as it helps to align strategy with expected performance and it stresses the importance of establishing financial goals for employees, functional areas, and business units. The BSC ensures that the strategy is translated into objectives, operational actions, and financial goals and focuses on four key dimensions: financial factors, employee learning and growth, customer satisfaction, and internal business processes. The BSC supports the role of finance in establishing and monitoring specific and measurable financial strategic goals on a coordinated, integrated basis, thus enabling the firm to operate efficiently and effectively (Peter Grant,1997).

Financial goals and metrics are established based on benchmarking the “best-in-industry” and include:

1. Free Cash Flow

This is a measure of the firm’s financial soundness and shows how efficiently its financial resources are being utilized to generate additional cash for future investments.It represents the net cash available after deducting the investments and working capital increases from the firm’s operating cash flow. Companies should utilize this metric when they anticipate substantial capital expenditures in the near future or follow-through for implemented projects.

2. Economic Value-Added

This is the bottom-line contribution on a risk-adjusted basis and helps management to make effective, timely decisions to expand businesses that increase the firm’s economic value and to implement corrective actions in those that are destroying its value. It is determined by deducting the operating capital cost from the net income. Companies set economic value-added goals to effectively assess their businesses’ value contributions and improve the resource allocation process.

3. Asset Management

This calls for the efficient management of current assets (cash, receivables, inventory) and current liabilities (payables, accruals) turnovers and the enhanced management of its working capital and cash conversion cycle. Companies must utilize this practice when their operating performance falls behind industry benchmarks or benchmarked companies.

4. Financing Decisions and Capital Structure

Here, financing is limited to the optimal capital structure (debt ratio or leverage), which is the level that minimizes the firm’s cost of capital. This optimal capital structure determines the firm’s reserve borrowing capacity (short- and long-term) and the risk of potential financial distress. According to Sidney L. Barton and Paul J. Gordon,(1987) Companies establish this structure when their cost of capital rises above that of direct competitors and there is a lack of new investments.

5. Profitability Ratios

This is a measure of the operational efficiency of a firm. Profitability ratios also indicate inefficient areas that require corrective actions by management; they measure profit relationships with sales, total assets, and net worth. Companies must set profitability ratio goals when they need to operate more effectively and pursue improvements in their value-chain activities.

6. Growth Indices

Growth indices evaluate sales and market share growth and determine the acceptable trade-off of growth with respect to reductions in cash flows, profit margins, and returns on investment. Growth usually drains cash and reserve borrowing funds, and sometimes, aggressive asset management is required to ensure sufficient cash and limited borrowing (B.T. Gale and B. Branch, 1981). Companies must set growth index goals when growth rates have lagged behind the industry norms or when they have high operating leverage.

7. Risk Assessment and Management

A firm must address its key uncertainties by identifying, measuring, and controlling its existing risks in corporate governance and regulatory compliance, the likelihood of their occurrence, and their economic impact. Then, a process must be implemented to mitigate the causes and effects of those risks( H.D. Pforsich, B.K.P. Kramer, and G.R. Just,2006) Companies must make these assessments when they anticipate greater uncertainty in their business or when there is a need to enhance their risk culture.

8. Tax Optimization

Many functional areas and business units need to manage the level of tax liability undertaken in conducting business and to understand that mitigating risk also reduces expected taxes (Q. Lawrence, 1994) Moreover, new initiatives, acquisitions, and product development projects must be weighed against their tax implications and net after-tax contribution to the firm’s value. In general, performance must, whenever possible, be measured on an after-tax basis. Global companies must adopt this measure when operating in different tax environments, where they are able to take advantage of inconsistencies in tax regulations.

On sum, The introduction of the balanced scorecard emphasized financial performance as one of the key indicators of a firm’s success and helped to link strategic goals to performance and provide timely, useful information to facilitate strategic and operational control decisions. This has led to the role of finance in the strategic planning process becoming more relevant than ever. Empirical studies have shown that a vast majority of corporate strategies fail during execution. The above financial metrics help firms implement and monitor their strategies with specific, industry-related, and measurable financial goals, strengthening the organization’s capabilities with hard-to-imitate and non-substitutable competencies. They create sustainable competitive advantages that maximize a firm’s value, the main objective of all stakeholders.

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Thank you for the great question is at the heart of my studies and I thank you for the invitation:

Not everything works internationally can be used locally, and this is what is rarely taken into account, especially now that the dilemma of estimating the fair value of the assets and businesses has become one of the most controversial topics now in most Arab countries.

First, the method of valuation with a net book value of the company

It means the net wealth of historical angel or accounting sense is the net equity value of the assets after deducting and ask any obligations or debts or liabilities of the Acharkh- third party - of the total assets of the company at the moment of evaluation.

This method relies on the historical cost of the assets and neglecting the real and the actual value of those assets - which does not take account of price inflation factors and changes in prices and neglect the economic capacity of the company to grow in the future

Second: The way the adjusted book value

Through which the re-calculation of the value of the company's assets using known so tables to adjust the value of the original diphtheria, taking into account the historical annual inflation rate of the crash in the prices of the assets of that company at the date of purchase of the asset until the valuation date, and is calculated net equity value based on that and shame on those the way that it does not take into account what is known as technological obsolescence of the machines, especially with what is characteristic of most of the business firms from obsolescence productive and technology, so that gives a valuable non-objective, and neglect the future growth potential of the company and take them into account.

Third: the way the replacement value

The idea of ​​this method to estimate the cost of establishing the company now is the same company replaced valuation characteristics, and with the lack of objective hypothesis upon which this method, especially with the characteristics of public sector companies that have passed most of the conditions in the origins and evolution of ownership make it difficult to assume re-established the same characteristics, these way too neglected growth potential of the company, and could be an error in estimating the current cost of incorporation with the reliance on the human factor in the estimate.

It is noted that the previous three methods are characterized by general qualities, it clarified it is based on neglect of opportunities profitability and future growth of the company, and the assumption that the buyer company buys only the historical to put them, whether taking into account the current situation of the company and factors of inflation and price change or not.

Also, these methods may give valuable blurb are not commensurate with profitability opportunities for some companies, such as real estate companies, it may give lower values ​​for each other is not in harmony with the capabilities of profitability high for those companies which exercised Khaddmaa activity such as banks as a result of the limited assets often.

Fourth: DCF model

The way Ali and the hypotheses which are to predict the financial status of the company until the end for a particular - has more than 10 years - is linked to age-productive for the company's assets, and the associated expected results of the company's business and financial position and cash position to her, and then deducting expected net company cash flows discount factor is appreciated, and takes into account the benefit of the risk-free deposit rates - the rate of inflation - and the risk of activity

Previous way is months and more ways to evaluate companies used and most widely accepted in the evaluation of companies that are trading their shares in inch stock, which looks at the company's capabilities and expected that growth this growth is measured in monetary strength of the company, which is in the financial thought the basis of the company's growth, and with the importance of that method but the problems are concentrated in that assumption and appreciation vast space, no doubt affect the objectivity of this method, especially with the length of the period of appreciation.

Fifth: evaluation method multiplier profitability

And it is estimated the value of the stock based on calculating the expected return per share for the year hit in profitability multiplier effect for the same traded on the stock exchange and carrying on the same activity companies. That method is based on the expected yield for one year and neglect the growth potential for the company in the coming years, based on existing market conditions which may not be expressive efficiently price and assume market efficiency, which means that companies traded representative of the productive sector.

The stock dividend is expected for the year = per share in cash distributions + reserves + What Ihtger of Orabahamadaaf profitability of shares traded = arrow applicable price divided by earnings per share in the profits or inverted rate of return on investment.

Sixth: The way the net market value of the company

It is similar to the way the replacement, which has already been talked about, but it deals with the company for the purpose of liquidation and not for the purpose of re-incorporation, the sense of neglect of the elements of the value components such as licensing, construction and utility costs, which must take into account the replacement value, and went with the same criticisms of the ways historical and current valuation.

Seventh: The way the residual value of the company

Which is analogous to the discounted cash flow model, but it merely a number Mahddod of years is not linked Bajil productive capacity of the assets shall be calculated for a residual value in the last year of the evaluation, it may be used more than one way to assess the residual value of the company .. or use a mixture of several ways.

In addition to the previous methods, it is no more than one way, but the previous seven months and roads are the most commonly used methods in the evaluation of companies.

 Method of discount cash flow model

This method to develop hypotheses by predicting the financial status of the company until the end of a specific order according to the useful life of the assets of the company, coupled with anticipation of the results of the business and financial position and cash position, and then deducting the expected net cash flows of the company by a factor of deduction are appreciated, including borrowing interest rates are taken into account in accordance with the the cost of financing sources and the risk activity

Taking into account the following:

- Future benefits, which is expected to be obtained landlords.

- The timing of receipt of those benefits.

- The degree of risk borne by the investor.

Meaning that the discounted cash flow method based on the grounds that the investment value is a present value of future economic income of this investment

2. multiplier method of profitability

Method earnings multiple based on the basis of calculating earnings per share forecast for the fiscal year and hits it return to profitability in force multiplier for similar companies traded on the stock market, which exercise the same activity scale.

The stock dividend is expected for the year = per share in cash distributions + reserves + is being held from profits.

Multiplier profitability of shares traded = arrow in an active market ÷ rate on earnings per share in the profits.

Yes, Its pleassure to give the assistance what i can.

First of we must distinguish between the general goals pursued by the company, such as adequately compensate shareholders, being the market leader, assume social responsibility or satisfy its employees, and the goals that are most often quantitative (turnover business, profit, growth rate), and time-bound. The objectives are then transformed into precise actions in the form of precise targets.

• The economic goals
• Quantitative goals
• Qualitative goals
• The development goals

A business management is to achieve the objectives defined beforehand, using efficient manner the physical, human and financial resources that the company provides for the realization of its action

APPROACH FOR DETERMINING OGJECTIFS.

Diagnostic organization:

- strengths and weaknesses

- distinctive skills

Environmental Diagnosis:

- environmental threats

- opportunities

- success factors

Strategic choice:

- areas: products - markets

- the action plan and forward programs

Objectives:

- growth

- diversification

-... Etc,

Also, the goal of a business depends on its financial position and means available (material, human and financial).

I agree with the answer / Ghada Awada

What kind of assistance do you need ?

You are welcome and ready for any assitance

Yes Agree , Its good to get update

Agree with the answer of  Nadjib RABAHI.