Caribbean Business Intelligence: TAJ RETURNS

TAJ's Returns on Investment (ROI), traditionally measured by annual yields (a combination of Dividend Income and Share Price Growth) is the main objective or mission of Investment Funds. Such Funds are employed in various sectors or industries, operating in various geographies and economies to generate Profits. Profits which are then divided into additional Investment (Reserves) and Dividends paid to shareholders. Reserves can be invested into the same or other business operations to generate more Profits and pay more Dividends or into other financial instruments to earn Interest. A business with a proven track record of generating Profits and paying Dividends regularly, can experience share book value growth or share market price increase, giving shareholders capital gains on their initial investment when their share are sold.

RETURNS – The following case illustrates a breakdown of fees and charges to startup a business operation requiring US$1,000,000. Please note; these cost would have been already factored into the Projections. Hence, money available to acquire assets and for operations is calculated to be, US$1,000,000 the net assets cost, minus US$41,500 in fees.

RETURNS – Services	Base Amount	Fees US$
Strategic Planning from idea to opportunity 10 hrs		1,000.00
Prospectus requiring Equity Funding costing 10%	250,000.00	25,000.00
Business Plan raising Debt Financing costing 2%	750,000.00	15,000.00
Corporate Services necessary to establish a bank account 10%	5,000.00	500.00
*Total Fees & Charges*:		41,500.00

RETURNS are projected to develop 1 Strategic Plan(s) in 10 hours per month, generating US$1,000.00 employing electronic advertising at a cost of US$484.65

RETURNS also uses extracts from the Strategic Plan to raises corporate funds over a 6 month period; equity funds at a minimum of US$250,000.00 attracts a 10% fee, while debt financing at a minimum of US$750,000.00 attracts a 2% fee, generating monthly fees of US$6,666.67

RETURNS also offers Corporate Services, chiefly to protect equity investors and meet all required regulations, the cost of which is set at a minimum of US$5,000.00 and attracts a 10% fee, generating additional monthly fees of US$83.33

Key Benefits

Dividend Policy are clearly set out in the investment prospectus and typically states that dividends will be declared and paid on specific calendar dates for the fiscal period recently ended and that the declared dividend amount will fall between a specified percentage range of cash flow at the end of the fiscal period under review. New operations may decide not to declare and pay dividends during the first few years to allow the business share value to grow.
Share Value of private companies is calculated by dividing the present book value of Assets minus Liabilities by the number of currently issued shares. Share Price of public companies is driven by complex supply and demand factors. As the business makes profits, so too does Shareholders’ Value Grow.
The Board of Directors is elected or re-elected by shareholders at an annual general meeting to serve for a specific term period or directors can be appointed by a constituted quorum of the existing Board of Directors in special cases to serve to the next annual general meeting. The constituted board and its appointed sub-committees are responsible for corporate governance and policies, implemented by management, that are applicable to protect the interest of all stakeholders.
Quality Management is applied through the Chief Executive Officer, Managing Director or General Manager position which is appointed by the Board of Directors to implement the board’s policies and oversee the daily operations. Audits are constantly performed internally and reported directly to the Board of Directors to maintain the company’s integrity. Legal and contractual issues are constantly reviewed and reported directly to the Board of Directors for further decisions.
Exit Strategies are designed to allow shareholders to, at the very least, recover their initial investment or benefit from increases of the share value. The first option is normally to offer the shares back to the company at book value, this “Buy Back” decision depend on the company’s cash flow and agreement of the Broad of Directors. Shares can also be privately transferred from seller to buyer at a negotiated price with the agreement of the Broad of Directors. The Company can also apply to be listed on a stock exchange and issue an Initial Public Offering (IPO) which will allow shares to be traded to a wider public at market value.