1.

PREVIEW

2. VOCABULARY

No New word IPA Meaning Example

English Vietnamese
1 Bankruptcy (n) /ˈbæŋkrʌptsi/ A situation in Tình trạng In an extreme case –
which a business phá sản bankruptcy – the
or a person owner’s equity will be
becomes repaid only after
bankrupt everyone else, including
employees, creditors,
banks, etc.., has received
what they are owned.
2 Extreme (adj) /ɪkˈstriːm/ very severe or Cực đoan
bad
3 Finance (v) /ˈfaɪ.næns/ To provide the Bù đắp, cấp The local authority has
money needed tài chính cho refused to finance the
for something to scheme.
happen
4 Debt financing /det Borrowing Việc huy Debt financing can come
(n) ˈfaɪnænsɪŋ/ money on credit động vốn vay from selling bonds, bills,
with a promise or notes to lending
to repay the institutions, individuals,
amount and sometimes, to
borrowed, plus investors.
interest
5 Equity financing /ˈek.wɪ.ti/ Issuing Huy động
(n) ˈfaɪnænsɪŋ/ additional shares vốn chủ sở
of common stock hữu
to an investor
6 Fresh share (n) /freʃ ʃer/ Stocks offered Cổ phiếu mới If a company gains a
first time to the listing on the Stock
public Exchange, this will
provide the long-term
opportunity of raising
capital by issuing fresh
shares.
7 Gearing (n) /ˈɡɪə.rɪŋ/ The amount a Hệ số vốn Gearing is the
company has relationship between
= leverage /ˈliː.vər.ɪdʒ/ borrowed equity capital invested in
compared to its the business and long-
share capital term debt.
8 Ownership(n) /ˈəʊ.nə.ʃɪp/ The fact that you Quyền sở Rate of home ownership
own something hữu have remained relatively
constant.
9 Overdraft (n) /ˈəʊ.və.drɑːft/ A draft or Sự rút quá For example, if an
withdrawal of hạn mức số account holder has
money in excess dư trong tài $1,000 in the account
of the credit khoản ngân and withdraws $1,200,
balance on a hàng this is an overdraft of
 bank or building- $200.
society cheque
account
10 Prosperity (n) /prɒsˈper.ə.ti/ The state of Sự thịnh In times of prosperity, a
being successful vượng high gearing will give the
and having a lot owners a much better
of money return as net profits will
be a much higher
percentage of equity
after interest payments
on the long-term debt
11 Venture capital /ˈven.tʃə Money that is Vốn mạo There are three main
(n) ˌkæp.ɪ.təl/ invested or is hiểm sources: firstly, venture
available for capital: this is usually
investment in a provided by venture
new company, firms interestedin
especially one financing high-growth
that involves risk companies.
12 Owner’s capital /ˈəʊ.nər The money Vốn chủ sở The first form of equity is
ˈkæp.ɪ.təl/ invested by the hữu owner’s capital.
owners of the
company
13 Unlisted /ʌnˈlɪs.tɪd sɪ A market Thị trường The Unlisted Securities
securities ˈkjʊə.rə.ti established by chứng khoán Market (USM), which ran
market ˈmɑː.kɪt/ the International chưa niêm from 1980 to 1996, was
Stock Exchange yết a stock exchange set up
fory the trade in by the London Stock
shares of small Exchange.
companies
which are not on
its official list
14 Long-term /ˌlɒŋˈtɜːm A loan that is to Khoản vay Companies prepared to
loans ləʊn/ be paid back dài hạn increase their gearing
over a period of can raise capital through
time, usually long-term loans.
more than 3
years
15 Pension fund /ˈpen.ʃən money that Quỹ hưu trí They can go to sources
fʌnd/ employees of a such as the clearing
company pay banks, merchant banks
regularly to be and even pension funds.
invested to
provide them
with a pension
when they are
older
3. READING

4. SUMMARY

Unit 17 talk about Funding the business, there are

 - Firstly, it talk about definition of gearing:
Gearing is the relationship between equity capital invested in the business and long-term
debt. The higher gearing, the more exposed the company is in times of economics
difficulty.

- Secondly, it talk about equity capital and advantage and disadvantage of its

Owner’s capital Venture capital Unlisted securities Stock exchange

market
Advantage The owners have a It is great chance to Allowing a The Stock exchange
claim on all the net raise big funds. company to: has the advantage
profits The venture capital + Raise money of provong the
doesn’t usually from outside long-term
interfere in the investor. opportunity of
running of the + Without losing raising capital by
company. much control of the issuing fresh
company. shares.
Disadvantage A return is received Venture capital However, this However, at least
only after all other company usually source of funds is 25% of the equity
calls on company demands a much available only to must be in public
profits have been faster and higher small and medium hands thereby
satisfied. In the case rate of return than company. reducing the
of bankrupt an owner would control of the
expect from his/her origial owners.
own capital.

- Finally, it talk about Long-term loans:

Companies prepared to increase their gearing can raise capital through long-term loans.
+ Long-term loans can give the owners much better because net profits will be a much
higher percentage of equity.
+ However, in harder times, the owner’s earnings will drop dramatically because interest
payments soak up most of the company’s profits