Wal-Mart is one of the largest international businesses with its operations in nearly 15 nations and approximately 8,500 retail stores running at a high profitability index (Lichtenstein, 2009). Wal-Mart appointed Charles M. Holley on September 24, 2010 as a CFO and EVP. At the age of 54, Holley had already been working with Wal-Mart as the company’s Executive Vice President for the Finance and Treasury division. He served at this position for 3 years approximately before which he was serving Wal-Mart as the Senior Vice President in the Finance division (Quelch, 2011). He is a multi-tasking personality with extensive experience in areas of accounting, taxation, financial reporting and investments.
From 2003 to 2005, Charles Holley was busy serving diligently as the SVP and Chief Controller at Wal-Mart. Cumulatively, from the starting of his career at Wal-Mart in 1993 up to 2003, till the day he was promoted to the position of CFO, his services were astounding (Quelch, 2011). He not only served highest ranking positions in the company but also kept himself involved in all major operations of Wal-Mart. The company witnessed the largest corporate level international acquisitions and mergers (Lichtenstein, 2009).
Previously, before becoming a part of the prestigious Wal-Mart, Charles Holley served as a Managing Director for the European Memorex’ consumer product division at Tandy Corporation. Another prestigious name that is highlighted on his resume is Ernst & Young where he served for over ten years. He likes teaching his practices and therefore serves as a Dean’s advisor at McCombs School of Business at Austin (Bloomberg Business Weekly, 2011).
Charles Holley caters the company with respect to managing the international business operations, projects of utmost financial impact, annual budgetary control, future capital investment requirements, plans to expand and develop; thus suggesting the probable and consistent basis for business financing. He is seen to be playing a key role in driving major strategic matters that can influence company’s future in the long term and deteriorate the profitability index. He is mainly seen to be undertaking investment decisions through seeking capital from financial markets and launching initial public offerings (IPO) (Quelch, 2011).
It is a challenge to operate at a large scale in diversified countries which creates not only financial challenges but cultural and social challenges as well. This imposes numerous obstacles for Wal-Mart in managing its contact with variability in rates of foreign exchange and rates of interest.
The company maintains its financial records in US Dollars and is therefore prone to fluctuations in the currencies of nations with which it is trading and is exposed to high variations.
Hedging to minimize the FX risk is the responsibility of the Treasury and International Finance Department which is headed by Charles Holley and he is responsible for selecting the right tool for hedging (Quelch, 2011).
Illustratively, if Wal-Mart buys its goods from a country which is prone to heavy currency fluctuation, and then trades the same goods to another country with a different currency, hedging against FX rates is prime tool for avoiding the losses on such dealings. Wal-Mart is known usually for using derivative financial instruments, which is currency swaps for hedging and trading reasons in order to control the foreign exchange risk it is prone to in the absence of this tool.
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