Global financial management

Review Global Financial Management By Thomas O’Brien Reviewed by FL Kelley Pace, University of Alaska This book provides a refreshing, focused approach to global financial management. It does not stray from its mission of educating potential managers about international financial products, ideas, and techniques. It does not overlap much with in~mational business texts. Not much discussion here of political risk or cultural factors. The index does not list an entry of “expropriation.” It does not stray very far into the intemation~ economics text territory. It hits on the relevant topics briefly, but it does not mire itself in long discussions of open economies, comparative advantage, and the history of international banking. In contrast to the average international finance text, it does not have much on global equity portfolios. The book motivates the financial risks arbitrage concepts well, proceeds to introduce international financial products, and shows how these can solve problems. Essentially, the text takes a problem-oriented, financial engineering approach. The book does have excellent discussions of international financial products. For example, it steps the reader through the settlement of forward contracts in more detail than texts I have used. It devotes an entire chapter to swaps. Hence, the text tends to contain details which answer specific, practical questions students often ask about these products. Beyond the hedging of ~ansactions risk, it devotes chapters to operating exposure, the relation between international finance and capital structure, accounting issues, capital budgeting, and multicurrency exposure issues. The text maintains its problem-oriented approach throughout these discussions. This text ideally suits students who want to acquire higher-level, job-related skills to increase their career prospects. It does not suit students who “have to take” international finance to graduate or who can see no applications in their potential jobs for using intemational financial products or techniques. From the professor’s perspective, this text shows a refreshing abstinence from phrases such as “in today’s changing world.” From the first chapter, it does not contain much filler. I was initially concerned after looking through the table of contents that the exposition might prove overly terse. Reading discussions of specific ideas or products soon dispetled these fears. The author’s frequent use of direct voice avoids unnecessary words which detract from the flow of the idea. However, he does not rush discussions of points and does provide a sufficient number of examples. In conclusion, Global Financial Management represents an excellent text for the right set of students. If the professor’s aims match those of the author, the text will not require supplementation. Other professors could easily use the text for the entree and season with supplementary materials to taste.

R. Kelley Pace l Department of Finance, University, Baton Rouge, CA 70802.

E.J. Ourso College of Business

North American Journal of Economics & Finance 8(l): 83 ISSN 1062.9408

Administration,

Louisiana

State

Copyright 0 1997 by JAI Press Inc. All rights of reproduction in any form reserved