Uggl Essay

1107 Words May 4th, 2013 5 Pages
Risk Management
“United Grain Growers Ltd (UGG)”

1. - UGC estimated that it would need C$150 million to carry out its strategic plans over the coming two years. Will its internal resources provide reliable funding for this program? How much external funding might it need?

After carefully reviewing the income statement, balances sheet and cash flow it seems that the company has a negative cash flow for 1998, so even before thinking about obtaining internal and external resources for long term investment, the company must assure resources for their own working capital.

This seems not logical or correct, because the secularization is meant for the company to raise cash by selling accounts receivables and reducing inventory, but for
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4. - Earnings at risk.

b) What steps would you need to work through to compute an “earnings at risk” for weather?
First you will need to get weather information for the last 50 years or more if you have the data, in case is less the accuracy of the model will decrease, after that you will have to compare that data with the crops yields for the same years, then in the next step the idea is to find the correlation using regressions techniques by identifying the most important variables that causes the weather to shift and affect the crops, at the end once you have identified this variables then you can predict the grain

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