Question

Pick any financial issue facing companies in the last few years to research (2013-Present) and provide a brief summary. It can be on financial issues in a particular industry or for several companies.

Answer 1

A primary financial issue that faces many companies in the developed as well as emerging economies is the hugely leveraged balance sheet that these companies have now.

For example, to cite some data total debt pf companies which are not in the financial sector in US stands at US$15 trillion by end of third quarter of 2018. Between 2010 and 2018, these companies have added about $ 5 trillion in debt. With such massive increase in debt, the balance sheets of most organizations remain fragile and thus are vulnerable to economic cycles. Also, this amount of debt has meant that ability to borrow and expand further is now limited which can further increase the chance of an economic downturn and that can further lead to the situation becoming critical for these companies.

So the high levels of debt for most US companies is a major financial issue that is faced by companies in most sectors.